Company Profile, Belize Electricity Limited

The BEL (Belize Electricity Limited) company describes itself as the “primary distributor of electricity in Belize”. In this article we have combined some statistics on BEL with regard to their customer base, the electricity generation and transmission, their financials and the regulatory challenges they are facing.

Customer base

Currently, BEL has some 76.000 accounts countrywide. This would include both business accounts and residential accounts. 

Electricity generation and transmission

  • In 2009, BEL sold 417.4 GWh of electricity. This translates to an average of 5565 kWh per account per year.
  • There was a peak demand of 76 megawatts (MW) in 2009.
  • BEL has an installed generating capacity of 34 MW.
  • 1,806 miles of transmission and distribution lines is owned by BEL.

Financials

  • BEL has BZD 472.3 million (USD 236.15 million) worth of assets in 2009, up from BZD 435.2 million (USD 217.6 million) in 2008.
  • From a loss in 2008 of BZD 10,838,000 (USD 5,419,000), the company generated a profit in 2009 of BZD 8,895,000 (USD 4,447,500).
  • Shareholder Fortis Inc. owns 70.2%.
  • Shareholder Belize Social Security Board owns 26.9%.
  • Unknown who owns the remaining 2.9% of BEL shares.


Regulatory challenges

From the shareholders report: 
It is with deep disappointment that we report that the regulatory challenges that began in 2008 remain unresolved. Belize Electricity Limited (BEL) continues to await the outcome of its appeal of the Public Utilities Commission’s (PUC) 2008 Final Tariff Decision, in which the PUC imposed a BZD 36.2 million (USD 18.1 million) charge against the Company, reversing regulatory decisions that had been approved as far back as 2002. The 2008 Tariff Decision caused BEL to be in breach of its loan covenants, preventing the Company from borrowing and also preventing the Company from paying dividends. 
 
Even as we continue to pursue an acceptable resolution to the 2008 Tariff Decision, we recognize that ultimately the Government of Belize needs to implement workable and stable regulations, managed by a competent commission. Investors and lenders simply will not finance a company where regulatory approvals cannot be relied on and sovereign agreements are not respected. Indeed, this protracted situation has already impacted the investment climate in the country and it will take a serious effort by the government, the regulator and BEL to restore investor confidence, even after the current situation is resolved. 
 
On June 17, 2009, the Court of Appeal upheld the Supreme Court’s decision, which found that the government acted legally in repealing the 2007 Tariff Byelaws. The repeal of the 2007 Tariff Byelaws opened the way for the PUC to reverse prior rulings, effectively forcing the Company to absorb BZD 38 million (USD 19 million) of excess cost of power as a result of record high oil prices in 2008. On February 6, 2009, the PUC issued an order, amending the 2008 Tariff Decision, to reduce electricity rates by 15 per cent, despite the pending court hearing. The Company challenged this order and obtained an injunction preventing the PUC from implementing that order until the legal challenge of the 2008 Tariff Decision is resolved. In January 2010, despite the legal challenge to the 2008 Tariff Decision, the PUC initiated court proceedings against the Company, claiming that it failed to file submissions for a Full Tariff Review Proceeding. BEL has responded to the charge and this court case also remains pending.