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Current Issues: BEL Chairman Sheds Light on Links between Power Cuts and Regulations

BELIZE CITY, May 2024 – In response to ongoing load shedding issues in Belize, E. Andrew Marshalleck, Chairman of Belize Electricity Limited (BEL), has provided a closer look at the structural challenges preventing the company from increasing its power generation capacity.

Marshalleck points out that BEL's operational scope is confined by regulatory policies, which restrict the company to only purchasing and distributing electricity. "Under the current regime and policy, BEL must not invest in alternative energy sources and bears no responsibility for procuring generation capacity other than requesting such additional capacity," he explained. This limitation significantly impacts BEL's ability to directly tackle the increasing demand for electricity.

The Chairman also addressed the misconception about BEL’s role in the electricity market. He clarified that the regulatory framework mandates BEL to operate as a Transmission and Distribution Company, which prohibits any form of engagement in electricity generation. This setup is intended to foster competition among independent power producers, theoretically lowering costs and improving supply. However, Marshalleck highlighted that "the market for electricity generation is not an open one which allows for any true competition in supply," indicating that the expected benefits of this system have not materialized.

“Competition is in fact state-managed,” explained Marshalleck. “The state decides who gets to compete, and it is in this decision-making process that the regime fails to deliver. Since 2013, the system for managed competition has not only failed to produce cheaper sources of power for Belizeans but it has failed to make such sources of power available any at all.

Despite these constraints, BEL has taken proactive measures. In the past year, BEL initiated significant upgrades at the Westlake GT and acquired a new GT for San Pedro with a combined investment nearing $80 million. These steps were taken to mitigate potential shortfalls in power generation as the demand continues to rise.

“Despite the policy and in the face of disapproval by the regulator (as published on its website), BEL leadership nonetheless went forward and upgraded the GT at Westlake and bought a GT for San Pedro and is having them commissioned in order to ameliorate the consequences of the anticipated generation shortfall in the short term.”

Marshalleck also revealed that BEL had developed plans for a solar farm and a battery storage facility, which the government has now taken over. He expressed hope that these projects would proceed as planned, underlining the importance of these initiatives for Belize’s energy future.

In concluding his statement, Marshalleck drew attention to the regional context, noting similar energy crises in neighboring countries due to factors like prolonged heat and insufficient rainfall, which also affect Belize. He urged for rational and scientific approaches to resolve these issues rather than reactionary measures.Marshalleck’s full statement is printed, in full, in this week’s issue of The Reporter.

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