IRC to audit DOMLEC

The Independent Regulatory Commission (IRC) is aware that Petro Caribe has increased its price per gallon of fuel supplied to DOMLEC under the new contract agreed with DOMLEC for the supply of fuel for the next year beginning March 1, 2011. We have been alerted of this fact by both DOMLEC and the Ministry of Public Works, Energy and Ports.

While it is likely that there would be some increase in the fuel surcharge, the IRC with the cooperation of DOMLEC is working to minimize the impact of the increase on consumers’ bills. To this end DOMLEC has been advised that the IRC will be conducting an audit of its fuel system to verify the correctness of the consumed fuel used in the calculation of the fuel surcharge by DOMLEC. The IRC will also be verifying the system for capturing the monthly sales figures used in the calculation.

The IRC has been working with DOMLEC on this matter and is surprised that DOMLEC would issue its release to the press without approval from the Commission. While DOMLEC is allowed to recoup the full cost of the fuel used in the generation of electricity through the fuel surcharge which appears on its bills to consumers, this must be done with the Commission’s approval, particularly when there is likely to be an increase. The Commission could only approve such an increase after satisfying itself that all is done to minimize the impact of that increase, and this will be done after the audits are carried out by the Commission.

DOMLEC’s release is therefore premature. A release will be issued by IRC after the audits are completed and the size of the increase (if any) ascertained. Any such increase will appear on consumers’ bills for the first time in April, 2011.

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9 Comments

  1. Know nut
    February 7, 2011

    Why do we have to meet the cost of fuel burnt .On what does the engines run ,certainly not water and if it does run on water as their propargenda states, why dont we see a reduction in our bills during the peak rainy season like right now when it has been raining for months nonstop Since DOMLEC is a privately owned company generating revenue for a foriegn entity, When is the IRC going to demand and enforce the payment of rent for their various poles which are sotuated on private lands,It must be borne in mind that these poles are generating income for DOMLEC while occupying space on someones private property

    • truth be told
      February 9, 2011

      Why do you pay Dowasco for water when Dowasco pipes the water to you? Do you pay Dowasco a reduced bill during the rainy season? Just Like with Dowasco it costs Domlec to pipe the water to the generator turbines. These pipes and all that connects to them has to be maintained too, though not as extensive as Dowasco’s, but they are to be anyway. Re the poles there is no law that can permit such payments. The act will have to changed for such. Wasn’t Petro Caraibe supposed to reduce the cost of electricity? After all they forced Texaco out now they are raising the price. Didn’t see you comment on that

  2. Lajabless
    February 7, 2011

    What about Petro Caribe that sells it’s propane cheaper than Shell and others ? And for years we were told that these prices were Government controlled .Now that the Government in Bed with Venezuela all of a sudden Petro Caribe price is lower .What is the story?

  3. negre marwon
    February 7, 2011

    We all know that this is just a smoke screen by the IRC. You all can jump high or jump low Domlec
    will do what they damn well please.Domlec is a MONOPOLY.They have us by the B…lls and they’re
    squeezing it tight.!That’s what happens when there is no competition. This is nothing new Domlec
    has done it before and they will do it again.

  4. Piper
    February 7, 2011

    I am not a believer in subsidies. Doing that just delays the inevitable. At some point government is not going to be able to afford the subsidies (either in whole or in part). When that happens and the true cost is passed on, the results often aren’t very good. This is how some revolutions begin.

    What they need to do is create conditions that allow people to afford to pay those bills.

    That is not to take Domlec off the hook for their business model. I think the government needs to lean on them to force them to look at every available method of generating power and do what is necessary to bring those costs to a level that is affordable to both the consumer and businesses.

    There is no doubt in my mind that the high cost of electricity is depriving the country of some businesses that could create the very employment that we need to allow people to pay those same higher electric bills.

    This is just a vicious cyucle that needs to be broken.

  5. Change we can believe in LBP
    February 7, 2011

    IRC members auditing DOMLEC need to understand that Dominica public while patient should not try to spin this information about an impending increase. While auditing the consumption by DOMLEC is good, but to a lay person like myself it sends a message that DOMLEC needs policing to ensure that they are complying with regulations and or policies set for price increase to consumers. The fact remains, if members of IRC can confirm an impending price increase to DOMLEC for consumption the obvious thing is that it will be past on to consumers. Where if any IRC can assist the local citizen is to let them know whether government can absorb part of the cost as an incentive to business and the public at large. This will go a long way from having a situation like the Coke factory sending business to neigbouring islands because their unit cost of electricity is lower for work that was being done in Dominica. We see how LIAT is under attack from CAL because Trinidad government subsidize fuel such that CAL pays $50/barrel compared to LIAT’s 100/barrel. We are heading into a real situation here people so forget the poiticians and all their antics to spin things to stay in power, and even our institutions are lacking ideas of how to deal with contracts like that of PDV to show some mercy on a poor country like Dominica. I do not know how these people sleep knowing that the person next door or their family are scratching and scrapping to pay this exhorbitant bills. The last time I was in Dominica, I saw Electrical bills for over $300 and I asked myself knowing how things will cost more down the line, what is to become of Dominicans when they cannot afford. Now, I understand why the crime rate is going higher because it is innate in human being to want a better life even if it comes at certain personal sacrifice. The people who show a blind eye to these issues and those who suck the country human resource at the expense to make an extra buck will soon find out the true cost; The very things like crime they show a blind eye to because their children are not involved will soon be their concern because according to Bob,”When the rain falls, it does not fall on one man’s house” therefore, we are our brothers/sisters keeper. We are all in this so let us stop being afraid to deal with tough issues and remember the common man/woman when we solve them to make their life more comfortable. Is that too much to ask? I hope not!!

  6. pedro
    February 7, 2011

    Great news. However lets hope the IRC goes far beyond accounting for fuel. The issues are wider than that. Here are a few tips on issues behind the story. IRC take note:

    By Law, Domlec can and does charge consumers for a proportion of the price paid for fuel used in production of electricity. The question is how fairly and how accurately is this done.

    Operational Efficiency and accountability. Domlec has not been able over the years to properly account for total fuel used in production. With the metering systems in place and measuring inaccuracies and losses, Domlec has routinely lumped fuel otherwise unaccounted for, as generator use. In the final analysis the monthly fuel used in the total production figures does not pass any serious audit of the system that measures total production usage. If one goes further, the generators used at Domlec does not allow for optimal efficiency of usage. Bottom line: consumers are paying much more for fuel used in generation 9through the fuel surcharge) than they should!

    Diesel plant as a proportion of total generation. The amount of fuel used is a function of types and efficiencies of generation sources. For example are generators services to produce the best fuel efficiency, are they serviced on time, is downtime of the most efficient generators longer than they should; is the company planning for and installing the most efficient generators, is the timing of the outages such that it allows the hydro plant to be used for maximum efficiency. Are the hydro units and water storage systems operated and serviced for maximum availability?

    What about the characteristics of the fuel. The chemical composition of the fuel can determine how well it is burnt in the diesel engines. Does Domlec have the best facilities in place to allow for the best quality fuel. Immediate things that come to mind are fuel filters and centrifuges. Does Domlec monitor fuel efficiency closely? what penalties if any are in place for quality below par? what about the storage and transport systems? how are they monitored for effect on quality?

    Losses and accuracy in metering/measuring. Losses are often lumped and passed off as production use. Of course that is unfair to the consumer. Losses can be Domlec’s fault, such as Operator error, equipment and line failure etc. How often do these happen? More than you think. What happens when meters fail? How does Domlec capture and account for losses? How often are meters calibrated? Does Domlec have the most accurate measuring systems in place.

    There is so much more to the story. It certainly has many facets to it. Take note IRC and stay tuned.

    • high speed
      February 7, 2011

      Pedro the IRC is setting up a customer Advisory Commitee, I went in for an application two weeks ago, brother I really think you should join in on that because you made some good points there and the way I see it we need to act brother, it’s a positive vibes man.

  7. joe
    February 7, 2011

    the next level
    when petro carib was introduced to the people it was sold to us a means of reducing our cost of living.

    Currently it is competing with the current fuel suppliers, and right now it is increasing our cost of living

    waw

    the next level

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