The world has been experiencing a steady rise in fuel prices on the international market in recent times, and this movement saw the price increase from $11.74 per gallon in January 2012 to $12.59 in April 2012.
Since Dominica is highly dependent on fuel for its electricity generation (approximately 65% of the electricity generated comes from fossil fuel sources), the increases in fuel prices have directly affected our local electricity rates. The high prices paid for fuel by DOMLEC, has therefore impacted the monthly fuel surcharge charged to consumers over the past several months.
The fuel surcharge escalation for the period January to April, 2012 – $0.4006/KWh to $0.5309/KWh – has been particularly steep. Neither the Independent Regulatory Commission (IRC), nor DOMLEC has any control over the price of fuel. We have to pay whatever price the world market determines, and this has been fluctuating widely because of the conditions existing in the fuel producing countries of the Middle East and North Africa.
As stated in our press conference of March 2011, the IRC wishes to assure the consumers of electricity in Dominica that it is well aware of the increases and is currently working with DOMLEC to effect savings and improve DOMLEC’s generating efficiency wherever those could be done.
Dominica is not the only country experiencing the rising fuel and electricity prices. Virtually every utility company in every region of the world that is dependent on fossil fuels for production of electricity is facing a similar challenge. For instance, in April 2012, the fuel surcharges for other countries in the region are as follows: St. Vincent 56.62 cents, Grenada 67.84 cents and Barbados 67 cents. What these figures reveal is that Dominica is doing marginally better.
Analysts predict that oil prices are expected to remain volatile throughout 2012 while socio-political crises in the Middle-East and Europe continue to impact the global market.
In light of this, the IRC remains committed to ensuring that the interests of electricity consumers are protected and that where possible, the impact of rising fuel prices will be kept to a minimum.
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