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First gas prices, then electricity increase PDF  | Print |  E-mail
Written by Richard Green/richard@fptci.com   
Thursday, 21 April 2011 10:14

Just as motorists in the Turks and Caicos Islands were watching gas prices soar past $5.50 per U.S. gallon, PPC Ltd. announced an increase in the fuel factor on electricity.

The fuel factor rate was increased from $0.1779 per kilowatt-hour (KWH) to $0.203, an increase of about 2½ cents. For customers using 400 KWH of electricity per month, the increase will add about $10 to their bills.

The fuel factor has not been over $.20 per KWH since January 2009.

PPC charges a base rate for electricity that has not been raised for many years, but the utility adds the cost of fuel used to generate electricity to its base charge using a fuel factor approved by the government. That factor moves up and down with the cost of world crude and diesel prices, which have been on a steady rise over the last year.

Those same world prices are helping to fuel the rising cost of gas at the pump, now approaching $6 per U.S. gallon. Crude oil is currently somewhere between $1.08 and $1.24 per gallon, while it was below one dollar in December.

But that’s not the only reason for an increase at the pump.

The interim government has just raised the fuel tax from 50 cents to 75 cents per Imperial gallon, for a total of 62 cents per U.S. gallon at the pump. That tax is expected to raise $6.24 million for the government’s capital expenditures in the new budget year that began in April.

Also included in the budget is a new Customs Processing Fee of 4 percent on all import invoices, adding another 11-15 cents per U.S. gallon, depending on the price of fuel, says Brian K. Lightbourne, President and CEO of Caribbean Energy Distributors Ltd.

Add the new taxes to the existing import duty on fuel of 37 cents a U.S. gallon, and the total amount being collected by the government is between $1.10 and $1.14 per U.S. gallon at the pump.

Taxes will go up and down as the price of fuel fluctuates, as will the cost of fuel used by shippers to get bring fuel to the TCI.

 

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