by Garth Buckner (http:/www.weblogbahamas.com)
The following piece, first published in The Tribune, Letters, is reprinted here with the kind permission of the author.
Once again the news comes out that BEC is failing, that it spends more than it earns, that it is in debt and that it needs bailing out. Once more we are presented with two false choices; Government can let BEC raise its rates or Government can inject more public money into the failing corporation. These are false choices because they amount to the same thing; if BEC raises rates then the Bahamian consumer is forced to pay more, if Government injects more public money into BEC then the Bahamian taxpayer is forced to pay more and, in the final analysis, the Bahamian consumer and the Bahamian taxpayer are one and the same.
It is no longer a surprise to hear that BEC has failed once again. We have come to expect it and we all know why it happens. Despite BEC’s unjustly privileged position of holding a monopoly over us over the supply of electricity, despite it being able to supply intermittent service at astronomical prices, it continues to fail because it refuses to reform itself. At the end of the day BEC plays and we pay.
The solution is not to put up rates. These are already out of all proportion and justification. They are already a hammer blow to the cost of living and the cost of doing business. BEC already makes us poorer than we otherwise would be. They have soaked the Bahamian people for every cent and there is little left to squeeze. More public money is not the cure either. You cannot tax a people more who are already groaning under the present burden of high taxation, and you cannot pile more debt on the backs of our children when our credit is close to maxed out. Quite simply there is no more money.
Even if there were giving BEC more cash is simply a cop out. It allows failure to continue failing. What we need to do instead is take the action required to fix our electrical supply and pricing problems to move the country forward. We need a dependable electrical supply at a competitive rate. This would go a long way to making the Bahamas a more attractive place to invest by lowering the cost of business. It would also reduce the high burden of the cost of living with which our people must struggle every day.
Thankfully this can be achieved. The way forward is to divide BEC into two, a company that generates power and a second company that maintains the grid that delivers the power to our homes and business. We then allow others, assuming it is environmentally prudent to do so, such as the garbage collection companies who have already submitted proposals to generate power through burning refuse, or the LNG people who have also put forward proposals to generate power locally, plus other options such as tidal or wind power, to go ahead and do what they are ready, willing and able to do, namely; generate power in competition with BEC. This would boost the dependability of supply.
It would also mean a real choice for the people. Customers would be able to pick which power generator they want to sign up with and would pay the generator directly. The power generation companies would then pay for the maintenance of the grid. The consumer would now be in the driver’s seat. Competing suppliers would be forced to listen and adapt if they hoped to attracted market share and a great burden would fall from all our backs.
As with BTC such a process of privatization and deregulation would not only bring much needed financial relief to the people it would also mean a windfall to the Treasury, both through the sale of BEC and the licenses to operate the competing power generation companies. Government would also save many millions in taxpayer money and interest payments on debt by being freed from the burden of propping BEC up. As the cost of doing business falls the Bahamas will become more competitive and so more profitable, the economy will grow and Government will see an increase in jobs and revenue collection on the back end. Its been tried before and its been proved before. It works.
We did it with the Hotel Corporation. We did it with the radio stations. We’re doing it with BTC now and we must do it with BEC next. We need to end the shame and frustration we all feel at seeing BEC fail and instead have a reliable and cost effective market for electricity that will build our nation and for which we can all feel proud. It’s time to save BEC.
June 18, 2009
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