Prime Minister Godwin Friday revealed during a live broadcast that electricity fuel surcharges in St. Vincent and the Grenadines would have surged past 90 cents per kilowatt-hour if the government had not implemented strategic measures to cushion the impact of rising global energy prices.
Addressing the nation from Richmond Hill, the Prime Minister highlighted the “difficult and quite unique circumstances” currently affecting the local economy, primarily driven by international pressures on oil and diesel prices resulting from conflict in the Gulf.
Friday stated that without the current policy interventions, electricity bills would be “quite a bit higher,” putting immense pressure on households, businesses, and the overall economy.
The Prime Minister detailed several steps taken by the administration since May to prevent the surcharge from reaching that 90-cent threshold:
- Tax Removals: The government removed the excise tax and surcharges on fuel to keep the price of diesel imported by Vinlec down.
- Utility Absorption: The government requested that Vinlec absorb a portion of the increased costs rather than passing them entirely to the public. In July alone, Vinlec absorbed over $730,000 that would have otherwise been charged to consumers.
Friday admitted that while the current surcharge remains “too high” for his liking and causes hardship, the situation “could be worse”. He emphasized that the government is constantly looking for “creative ways” to assist consumers and improve the standard of living despite the economic crisis originating offshore.
While describing subsidies as “short-term solutions,” the Prime Minister outlined a broader strategy to move the country toward renewable and sustainable energy systems. He noted that reducing vulnerability to future international shocks requires Vinlec to lead the way in investing in affordable renewable technologies.
Friday also urged the utility company to show “more grace” regarding bill collection during this crisis, noting that as a state-owned entity, it must understand the reality of the residents’ struggles.
“We all have to in a sense through this crisis, you know, bear a little bit of the pain,” the Prime Minister said, while reiterating his commitment to finding measures to eventually reverse the surcharge increases.
