New OUR-Approved Rates to be reflected on Bills this Month
JPS customers will begin to see the new OUR-approved rates on their electricity bills this month. The OUR’s Rate Determination will result in an overall reduction of approximately 1.8% on the average customer bill.
All rate classes will see a decline, with average bill impact as follows:
Rate 10 (Residential Customers): -1.6%
Rate 20 (Small Commercial Customers): -1.6%
Rate 40 (Large Commercial Customers): -2.0%
Rate 50 (Industrial Customers): -2.0%
Rate 70 (Industrial Customers): -10% relative to rates previously experienced by these customers.
The New Rates are as follows:
Other Key Elements of the Rate Determination:
Sales Growth Benefit Passed on to Customers: JPS will pass on J$2Billion to customers, as a result of an adjustment associated with sales growth, exchange rate recovery and system losses penalty. This is one of the advantages of the Revenue Cap regime: higher sales gains go back to customers while it protects JPS from a dramatic drop in sales.
New Rate Class for Industrial Customers: The OUR has accepted JPS’ proposal for a new wholesale discount rate to be introduced for large industrial customers. Businesses that qualify for this discount rate had peak demand of 2 MVAs (megavolt-amperes) or above, at a single location in the previous year. To facilitate the introduction of the special wholesale rate, a new Rate 70 class has been introduced. Customers in this rate category will see an average 10% reduction in bills.
The objective of the new discount rate is to facilitate greater productivity and provide an incentive for large customers to stay on the grid, which will ultimately benefit all JPS customers. By giving these commercial customers a discount, we are discouraging them from leaving the grid, which would mean higher costs for everyone else staying on the grid. In addition, as these customers stay on the grid and use more electricity, customers can look forward to more sales growth having a positive impact on rates through the revenue cap.
Community Renewal Rate: A special rate has been introduced to facilitate low income customers, who qualify for support through the Programme of Advancement Through Health and Education (PATH), and who want to regularise their service. These customers will pay an approved flat rate for consumption up to 150kWh, and the regular post-paid or prepaid rate for any usage above 150 kWh. In addition, post-paid customers who qualify for this rate will not pay the standard customer charge if their consumption stays below the 150 kWh.
System Benefit Fund: A new System Benefit Fund (SBF) has been introduced to support the modernization of the electricity sector. In keeping with the requirements of the Electricity Act, the use of the SBF will be determined by the Minister of Science, Energy and Technology. JPS will make monthly deposits to the SBF, via an account established by the OUR specifically for this purpose.
The SBF replaces the Electricity Efficiency Improvement Fund (EEIF), which was used specifically for anti-theft projects. JPS recommended that the EEIF be terminated and replaced by the SBF, which allows for a wider range of options, including initiatives to address electricity theft. The SBF will be administered by the OUR.
Improved Efficiency: The resetting of the Heat Rate Target from 11,620 kJ/kWh to 11,450 kJ/kWh will encourage JPS to be even more efficient in its use of fuel in the generation of electricity.
Adjustment to Base Rate: An adjustment of 0.65% has been made to base electricity rates, to account for inflation and exchange rate movement.