The Guardian (Belize)
December 9, 2001
If Fortis/Belize Electricity wanted the cheapest possible source of new power supply for ratepayers, it would have insisted upon an open and competitive bidding process, writes Probe International’s Grainne Ryder.
Public Relations and Information Officer
Belize Electric Company Ltd. (BECOL)
P.O. Box 327
Belize City, Belize
Dear Ms. Sampson,
In your response to my article "Belize needs a free energy market, not more dams," National Post, October 31, 2001, you insist that your parent utility, Fortis/Belize Electricity, is not using its monopoly to protect BECOL’s Chalillo hydro dam from competition.
Your argument has no credibility given that you ignore the monopoly structure of Fortis’s electricity empire in Belize: Fortis owns BECOL, a private hydro company and it is majority owner of the state-protected monopoly, Belize Electricity, which is responsible for distributing and selling electricity to ratepayers. Fortis/Belize Electricity can therefore use its monopoly to pass along the costs of its uncompetitive power purchases to its captive ratepayers.
If Fortis/Belize Electricity had wanted to find the cheapest possible source of new power supply for ratepayers, it would have insisted upon an open and competitive bidding process to attract the best bids from potential suppliers. With competition, local industries, Mexican power producers, and any number of energy companies worldwide, such as Boratex or Transalta (Canada), PowerGen (UK), or Cinergy Solutions (US), would have lined up to compete against BECOL.
Instead, Belizeans must suffer the negotiated deals that Fortis/Belize Electricity strikes with its hydro subsidiary, BECOL, with no disclosure of those deals and no competitive bids from other potential suppliers.
Fortis/Belize Electricity decides – as the majority owner of the country’s electricity grid – who supplies the grid, and at what price. Furthermore, it has an arrangement with its hydro subsidiary, BECOL, to buy its output first, even though there are cheaper more reliable suppliers ready to supply the grid, either for peaking power or baseload, both locally, in neighbouring Mexico, and elsewhere.
In light of these facts, your assurances – that the Chalillo and Mollejon hydro dams can provide least-cost service for ratepayers, and that Fortis/Belize Electricity knows best how to keep the lights on in Belize – are unconvincing. If such claims are true, then kindly prove it, by disclosing the details of BECOL’s power purchase arrangements with Fortis/Belize Electricity, before committing ratepayers to the Chalillo dam.
Policy Director, Probe International
Categories: Chalillo Dam
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