Articles

Fri 2nd Sep 2011

Are Vinlec's customers being taken as suckers with high light bills?

SVG's grossly incompetent Minister of Finance, PM Ralph Gonsalves, is not doing enough to cut the astronomically high price of light bills. Vinlec has a monopoly on the sale of electricity in SVG, so prices should be cheaper. The high price of electricity is choking the SVG economy and punishing poor families.

The Lowman's Bay Plant, with a generation capacity of about 16 Megawatts, gives policy makers substantial latitude in the low demand period. They could cut the diesel-powered Cane Hall generating plant operations from 11pm to 7am each night. A lot of electricity is being produced at night and wasted as it is not used.

Also, with the hydro plant running and producing about 20% SVG electricity, there is more reason to close down Cane Hall at night during low electricity usage.

This innovation will reduce the quantity of oil used, and hence, cut the fuel surcharge and SVG's massive fiscal deficit. This will bring down the cost of light bills for all households.

The table below shows the chronic weak management by Vinlec and the SVG Minister of Finance.

 

1998

2009

Difference

% difference

Revenue

$47,798,172

$102,691,745

$54,993,573

115%

Admin cost

$7,914,329

$18,235,767

$10,321,438

130%

Net Profit

$3,528,723

$2,028,135

$1,500,588

-73.3%

% Profit

7.38%

1.97%

-5.41%

-73.3%

One can see from the table that from 1998 to 2009 Vinlec's revenue (which means the amount they charge us) has increased substantially, by over $54 million. In 2009, we were being charged 115% more than we were in 1998. Also, Vinlec's administration costs have increased like wildfire by over $10 million. This is a massive 130% more than in 1998.

These figures show that under the financially incompetent minister of finance, Gonsalves, Vinlec has become incredibly inefficient. The percentage profit figures show how bad things are. In 1998, Vinlec had a profit of 7.38%, but by 2009, profit had plummeted massively to only 1.97%.

This is a scandalous drop in percentage profit. By 2009, Vinlec's profit had dropped by over 73% since 1998. Vinlec has become highly inefficient under the ULP regime. The minister of finance's incompetence would be laughable if we were not paying for it. Our high bills are due to the lack of innovation, foresight and financial ability of the minister of finance, Gonsalves.

Are Vinlec's customers being taken as suckers? Inefficiency and incompetence are making electricity bills so high. Vinlec should cut electricity bills by 25% immediately by reducing inefficiency, and then cut bills by another 15% next year by cutting out inefficiency altogether. If the minister of finance is too incompetent to do this, then he should resign.

The SVG 2009 budget was $751m, 13% of which was $103m from Vinlec's customers - us!

SVG Green Party calls on Vinlec to make a public statement to tell the people of SVG where the $13,831,312 of 'other expenses' was spent in 2009.

Gonsalves and Eustace are not university graduates in finance. Since 2000, they have both shown that they cannot build a strong economy. SVG needs a new direction or the economy could crash and cause serious problems. A Green government will create a strong economy and thousands of jobs.

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