JPS mulls new pricing strategy
AS part of plans to address what it regards as some ‘loopholes for abuse’ in current systems the country’s sole electricity distributor, Jamaica Public Service (JPS), has indicated that it will be looking at more solutions as it moves to improve current pricing structures.
As the company prepares to start its next five-year tariff period for the new 2024-2029 installment, discussions with regulator Office of Utilities Regulation (OUR) about a possible rethinking of is pricing strategy, especially for residential customers, it said sits atop chief objectives.
“Our aim is to make the pricing experience better. We want to offer our customers choices, with simpler price plans, while ensuring that all who use the grid pay their fair share. To this end, we are working on creative, collaborative, and sustainable ways to achieve tariffs that help affordability, but without the loopholes for abuse that now exist,” the company’s directors said in its recently published annual report.
Speaking with the Jamaica Observer at the start of this week, Chief Financial Officer Vernon Douglas, in offering some clarity on the intent and extent of these plans, said while they remain a work in progress, the entity continues to work with the utilities regulator to ensure it builds on service delivery as it unlocks more value for customers.
“The plans are in line with the ensuing five-year period and as we make our business plan submissions to the regulator. At this juncture we are not yet ready to comment specifically as to what some of these plans are, however what I can say is that we are very excited about what the future will look like for our customers following these improvements,” Douglas said in his response to queries from the
Business Observer while promising more detailed information about the intended plan in the coming months.
The light and power company, while noting that the traditional flick of a switch is becoming less sustainable, also said that from the upcoming improvements they want customers to be able to “freely choose the type of energy they want from the grid, when they want it, and for what purpose”.
“With a cost-reflective price structure we can consider offering our customers different pricing tiers that cater to their preferences as we give them more choice and greater control while still remaining viable,” the directors also noted.
Touting continued capital investments across its operations, the electricity distributor said up to last year some US$41.8 million was invested across its energy delivery network, US$14 million in grid modernisation initiatives, followed by another US$12.1 million in power plant improvements.
In continuing to combat the widespread socio-economic challenge of electricity theft, the company said it will also be banking on some forged strategic partnerships it now has in place with a number of entities such as the Ministry of Energy and Jamaica Social Investment Fund (JSIF), to ensure that reliable and safe electricity supply is made available to the underserved and off-grid communities across the island.
Last year the company for the first time in more than a decade said it was able to meet its internal losses target — achieving 12-month rolling losses of 27.8 per cent against a target of 28 per cent.
“We are hopeful that our collaborative approach to fighting theft will be sustained and will deliver lasting results, ultimately leading to a reduction in the cost of electricity to paying customers,” the report further detailed.
At the end of its last financial year, group operations returned increased net profit of US$68.2 million — 25 per cent above the previous year despite slightly reduced revenues of US$1.1 billion and total assets of US$1.7 billion.