Wednesday, August 31, 2011

A Rude Awakening

Our electricity bill arrived the other day, and my eyes nearly popped out of its sockets when I saw how much we owed. Adding insult to injury, we had received the bill just after having lost power for three days due to Irene. Those of us who live in Puerto Rico have always had to spend much more on our electric bills than our counterparts on the mainland. According to the U.S Energy Information Administration, the average retail price of electricity per kilowatt in the U.S is $0.11 cents back in February of this year. On the island, the average cost per kilowatt for households this past June was $0.28. If Puerto Rico was a state, it would have the second most expensive electric costs. The most expensive is Hawaii, at $0.31.

As a blog reader once pointed out to me, those of us who pay our electric bills (at unsubsidized prices) are subsidizing those who aren't. In fact, some churches, hotels, public housing projects (aka caserios) and municipalities can keep their lights on 24 hours a day, as they practically get electricity for free (and some in fact do). Another reason why electricity is so expensive in Puerto Rico is because many people steal electricity (not to mention water as well). This has led to an estimated $700 million loss between 2009 and 2010. The fact that 70% of the island's energy comes from petroleum exacerbates the problem. The situation has gotten so dire that some restaurants are directly passing the high energy prices on to its customers, listed as the "AEE Adjustment" on their bills.

During the past few weeks, la Autoridad de Energía Eléctrica (the Puerto Rico Power Authority), a government corporation, has come under fire in its billing tactics. The AEE uses a formula which weighs heavily current oil market prices. Jeniffer González, President of the island's House of Representatives, has promised to implement significant changes as to how the AEE charges its customers. High energy costs is a serious impediment to the island's economy, as consumers have less money to spend on other household goods. In addition, for businesses, it increases operating costs to a much more dramatic level. Meanwhile, the Fortuño administration is placing its bets on the Via Verde gas pipeline to help alleviate the island's skyrocketing energy prices.

1 comment:

Kofla Olivieri said...

The other day I've read somewhere that AEE is unable to explain a detailed breakdown of the electric bill. What a scam, I personally think AEE and the government are in cahoots to force people to say yes to the gas pipeline.

And in reference to restaurants passing an extra charge "as the AEE adjustment", that is the most ridiculous thing I've ever heard. Do Macys and Bloomingdales add it's customers an extra charge evrytime Con-Edison in New York raises their bill? Unbelievable, only in Puerto Rico.