DOMLEC applies for rate review; cheaper electricity possible

DOMLEC has applied for a depreciation rate review, according to Cover
DOMLEC has applied for a depreciation rate review, according to Cover

The island’s sole light and power company, Dominica Electricity Services LTD (DOMLEC) has applied to the Independent Regulatory Commission (IRC) for a depreciation review of its existing electricity rates.

If the new depreciation rates are accepted by the IRC, consumers stand to pay less for their electricity supply, the company’s general manager, Collin Cover told a public consultation on Thursday.

“When establishing rates the commission must look at how much money does it take to run the company, and this amount of money that it takes to run the company is called the revenue requirement,” he explained. “The IRC then allows a profit on top of that amount. The smaller the revenue requirement, the less the customer pays.”

According to Cover using the old rates, DOMLEC’s depreciation expense for 2013 would have been $11-million.

He added that with the new rates the company is proposing, the depreciation expense for 2013 would been $8.4-million, which will result in a $2.6-million decrease in the revenue requirement.

He noted however that it will not stay at that amount since new equipment is added and the depreciation changes.

“We do not think it is wise to go into a rate filing using depreciation rates that are more than 20 years old and which do not necessarily reflect the current state of affairs in the company,” Cover noted. “When you’re starting a company, you use generic depreciation rates but if the company stays in business long enough it builds enough history to establish its own depreciation rates based on its own experiences.”

DOMLEC executed a depreciation rate study in December 2012, which revealed that its equipment can be used for a much longer period of time than previously indicated.

IRC Regulatory Consultant, J. Paul Morgan, noted that the commission has not taken a decision on the matter, however is of the view that the rates proposed by DOMLEC are generally acceptable.

There has been no rate review of DOMLEC since the IRC came into existence in 2007.

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16 Comments

  1. Nrt
    March 11, 2014

    Domlec passing ‘savings’ to customers? Well look it, the Fleecing of the Nation continues in some disguise?

  2. side looker
    March 9, 2014

    Dominica has abundance of water ,therefore my real problem is not Domlec but Dowasco if you had to use your water supply as of how electricity is used we would not be able to pay our monthly bills to Dowasco, I this we should not only put pressure on Domlec but also Dowasco where we the consumer also face the pressure.

  3. Anonymous
    March 7, 2014

    :lol: get labor out!!!!

  4. Castle Comfort
    March 7, 2014

    Soon we will hear that the Port fees are lowering.

  5. Luv
    March 7, 2014

    We may need to have elections annually so we can have some yearly relief. That’s what transparency is all about. No doubt about that

  6. RED 2 BLUE
    March 7, 2014

    This government is using the IRC to kwayvay DOMLEC to try to win elections

  7. Mahaut
    March 6, 2014

    Another Jombi in bag! I want to tell DLP that the Dominican people are not falling that one.
    How many factories have you guys open since you all are in office?
    Manufacturing is the key to any economy. We have enough local raw materials to do that.

  8. St.Joe
    March 6, 2014

    First of all since when a company that is in the business to make a profit comes forward to help consumers save money by paying less to them? Those DLP “tricks in hat” will not fool is anymore. They think we soot!
    DLP has seen that the people are bent on voting them out of office and is coming up with all trickery to confuse the masses. But as we the St.Joe people have said, 15 years is enough for the DLP. Say the same around Dominica.

  9. eyes open wide
    March 6, 2014

    uwp that have domlec playing big boys on Dominicans have us paying so much ,no matter wat government that come and go they should be running the company,in Antigua government have water ,lights and telephone maybe if our government had the same thinking they would not be killing us with all them tax ,just saying :-|

    • The Times
      March 9, 2014

      i agree with what you just said but there are a couple of times since the DLP have been in power that DOMLEC have switched hands. So why have they not think of buying it back?

  10. The Times
    March 6, 2014

    In more recent times i have been hearing more and more ppl on the opposition or closely affiliated to the opposition talkin bout renewable energy that actually makes sense to us now suddenly DOMLEC comes out with this. I the IRC gotta give the ok but… Why should we believe that this will come to fruition and how long would it take?

    • The Times
      March 6, 2014

      know**

  11. March 6, 2014

    How long the rate will be cheaper for , as soon election done everything go sky high again we been fool so may times by these people time for a change my people let’s wake up and do the right choice

  12. Trutru
    March 6, 2014

    Once elections around the corner, some how things “Bunk and Compel” to go down for the masses until they win and the ‘M’ disappears – D Wrecker….. hehehe.

    We waiting for the Bro-go-dohwou and duty free on building materials … again it just “Bunk and Compel” to happen, using Mr Red-more’s words….. Lol!

  13. african queen
    March 6, 2014

    only now! this people want us to believe that only now they care. My people be careful wat you do this election. skerrit has a plan to take revenge and to make us into beggars and to depend upon the scraps that falls from the table. I am Warning, Mr Louis Warned. Be wise vote for change if change does not come you will know wat to do. But Try CHANGE

  14. Anonymous
    March 6, 2014

    2007
    what ?
    isnt that supposed to be annually ?
    But wait
    who lapsing .
    We Dominicans born to suffer .

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