'Too late' MSME Alliance says OUR failed to protect consumers

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THE Micro, Small and Medium Enterprises (MSME) Alliance says billing problems, which last week forced the Government to announce a probe of the Jamaica Public Service's (JPS') billing and metering policy, could have been addressed sooner if the Office of Utilities Regulation (OUR) had acted on its earlier complaints.

According to Professor Rosalea Hamilton, President of the MSME Alliance, as far back as September last year, members of the lobby group presented their concerns about various aspects of the JPS' operations, which were negatively impacting members' businesses.

In its 10-point Energy Proposal, which was presented to Prime Minister Bruce Golding on September 2, 2010 as part of its petition for more support for MSMEs, the Alliance highlighted several electricity billing concerns, including the need for investigation of the functionality of JPS meters by the Bureau of Standards and independent professionals.

The group intensified its efforts in this regard three months later at a subsequent meeting, according to Prof Hamilton.

"The matter of the meters was brought to the attention of the OUR on December 7, 2010 in a meeting with the prime minister and, to his credit, the prime minister requested an investigation in light of the technical explanations of the concerns expressed by Owen Gunning (President of the Jamaica Society of Energy Engineers)," Prof Hamilton told the Observer.

According to the current draft status report of the MSME Alliance, Gunning's and the membership's concerns were due to the fact that the meters "could be configured to read not only energy input and also energy output when delivering excess energy to the JPS grid from photovoltaic (solar) systems".

"For MSMEs with photovoltaic systems connected to the JPS grid, it was reported that the JPS meters were adding the power input and the photovoltaic power output when not using the full capacity of their system. This would result in the meter giving a higher reading and therefore higher cost," the report reads.

According to the MSME document, after a meeting with the Alliance and OUR on December 16, 2010, OUR agreed to collaborate with the MSME Alliance through Gunning. The draft report also states that attempts were made by OUR to have a follow-up meeting, but to date none has been held.

Additionally, the MSME Alliance, in its September 2, 2010 petition, had asked for a review of the JPS rate categories which, the lobby group claimed, had led to some MSMEs paying higher utility rates.

The group wanted the introduction of a special lower rate category of tax-compliant MSMEs.

According to its draft status report, at the July 28 Stakeholders' Lunch meeting with OUR, Prof Hamilton questioned the whether OUR monitors the commercial rate billing categories, and "questioned the rationale for the time frame of the ratcheting period for the kVA (kilovolt amperes)/demand charge.

"It is our view that the existing rate structures are excessive and bears no relationship to international standards. We believe that the OUR needs to review the pricing mechanism of electricity especially in light of JPS high profit even with 20 per cent of electricity being stolen," she asked then.

It is this kVA charge that the owners of Jo Jo's Farm Market in Kingston, on which the Sunday Observer reported two weeks ago, said resulted in astronomical bills that eventually forced them to close.

Subsequent to the MSME's complaints, at a meeting with energy minister Clive Mullings on August 10, 2011, OUR agreed to review this application of this kVA charge.

Nonetheless, it is the opinion of the MSME Alliance head that the OUR was slow off the mark.

"If the OUR had acted since the request of the prime pinister, instead of (now) bowing to mounting public pressure, the country would have known the outcome of the investigations by January 18, 2011, six weeks later, and would have a better understanding of the legitimacy of the high billing complaints as well as the appropriateness of the JPS' back-billing policies and procedures," she added.

"On this matter, the OUR was delinquent in pursuing its responsibility to 'protect the health and well-being of consumers as mandated under the Office of Utilities Regulation Act (1995)."

On July 28, Prof Hamilton and represenatives of the Private Sector Organisation of Jamaica were invited by the OUR to its regular stakeholders' lunch.

She told the Observer she used this occasion "to again remind the OUR of the request by the prime minister, and pressed the OUR to act urgently in light of the business closures currently being experienced by MSMEs".

Last Thursday, the OUR announced that it would use the next six weeks to investigate the legitimacy of high consumption billing complaints following the replacement of old JPS meters with new digital ones; the process that JPS followed in effecting the changeover of the meters; the appropriateness of JPS' current Back-Billing Policies and Procedures and the extent to which the billing practices are in compliance with the existing quality control procedures.

The JPS board also announced it would take into account the widespread complaints, which culminated in a nationwide silent protest dubbed, 'Black Out Friday', and conduct its own independent audit of its systems.

These probes come following weeks of public outcry about massive spikes in light bills from average citizens, politicians and members of the business sector; some claiming astronomical electricity bills put them out of business.