As Energy Prices Climb
So Do Attempts to Rectify Tariffs

June 1st, 2010
by Jennifer Mathews Photograph by Benjamin Roberts


Workers check and maintain RECO services on May 21

Workers check and maintain RECO services on May 21

In the month of May, RECO customers saw a increase in their bills, which lead to high tensions and talk of dissent in the streets. Roatan mayor Julio Galindo appeared on television Channels 27, 7, and 9 on May 13, to assure the people of Roatan that he and Bay Islands Diputado Romeo Silvestri were working hard to find a solution to their grievances. He asked the constituents to wait until he returned from Tegucigalpa with a “positive outcome.” While some misunderstood the message to mean that they should not pay their bills, Galindo reappeared on TV on the 16th, clarifying that bills would be due, but that RECO had agreed to grant a 10-day grace period before turning off people’s lights. According to Richard Warren, president of RECO, the 10-day grace period began the day Galindo and Silvestri left for the capital, on the 18th. “We were happy to give it,” he reported. “We want this thing to be resolved in the best way just as badly as everyone else.”

According to Warren, by law, RECO must submit a new tariff every five years. This is submitted to the Commission on Energy to review and approve a new rate for the utility company. It has been almost 15 years since a review and new rate approval has been done, the last review carried out in 1996.

Galindo and Silvestri met with the president of ENEE, Secretary of Internal Affairs, Vice Minister of SERNA, Chief of Staff at the Presidential Palace, Vice President, and the President of the Commission of Energy, among others. A multidisciplinary committee was formed to visit Roatan for the purpose of evaluating RECO’s tariffs, confirming financial proposals, and holding public hearings.

The Committee was to arrive at RECO on Monday the 24th, but due to inclement weather in Tegucigalpa, they arrived too late to evaluate RECO, but did hold a public hearing at the Roatan municipal building, along with public officials and leaders of the Patronado. The committee received grievances from the public and gave explanations about the upcoming procedures. As there were rumors of street demonstrations in los Fuertes the next morning when the commission was to visit RECO, Galindo made clear that people were welcome to vent complaints in a peaceful manner, but that anyone who took to the streets would be incarcerated. Given the threats that the cruise ships made last year about pulling out of the island Roatan stands to lose a massive amount of tourism dollars over any potential conflicts. According to Silvestri, the commission’s full report should be completed by the 28th.

Diputado Silvestri is trying to push through the 150 subsidy before the next bill. This means that 45% of their customer base is eligible for the subsidy as they use less than 150 kwh (really 35%, take away the 0-10 range for vacation houses). The way this would work is that Zolitur would hold two months worth of the subsidy, and the central government would replenish the money allocated by Zolitur. “We have been fighting for this for two years and currently have an application in with Zolitur,” said Warren. “It’s taken us 2 years to convince the government that they would be giving money to a public utility, not a private entity.” Romeo feels confident this will go through in July, if not before the session on the 10th, then by the end of July.

When asked why the islands have been ignored, Romeo responded, “I’m the first one who’s really working on it!” Within three weeks of being sworn in as Diputado, the issue was on Silvestri’s agenda. In Tegucigalpa, where we interviewed Romeo, he responded that he felt the environment very positive and that congress is very receptive.

As of May 21, RECO had only collected 1/3 of billings so far for the month of May. They were required to collect 2/3 by the 28th, just seven days later, and ultimately all the meters must be read by Sunday the 29th or risk being shut down. [/private]

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