Rise in fuel causes increase in price of overall electricity

By AdminUpdated 12:41p.m. Wednesday, May 25, 2022, Atlantic Standard Time (GMT-4).

Customers of the St. Vincent and the Grenadines Electricity Services Limited (VINLEC) are advised that although the basic rate for energy has not changed since 1989 for domestic customers and since 2011 for commercial and industrial customers, the rising of fuel is causing an increase in the overall cost of electricity.

 Customers are reminded that the base rate for electricity includes less than five percent of the cost of the fuel used to generate electricity.

VINLEC said: “since December 2021, the average cost per gallon of fuel used by the company to generate electricity has increased by over thirty percent, resulting in a similar change in the fuel surcharge rate.”

The electricity company said during this period, the average cost of fuel has moved from $8.84 per gallon to $11.50 in April, while the fuel surcharge rate has moved from 44.71 cents per kWh to 59.48 cents per kWh.

 VINLEC noted that: “during the month of May, the company has seen further increases in the price of fuel that would lead to an even larger increase in the fuel surcharge rate. Although the Customs Service Charge (CSC) of six percent on the price of fuel been removed, the company has thus far paid an average of approximately $14.20 per gallon for fuel purchased in May. This represents an increase of $2.70 in the fuel surcharge rate on customer’s electricity bills for month of June.”

 The price that VINLEC pays for the fuel to generate electricity is a reflection of the price of fuel on the international market. The company is hopeful that this upward trend will soon be reversed as this will ultimately lead to lower price for the fuel used to generate electricity and a consequential reduction in fuel rate.

 

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