OUR sets out method for electricity wheeling charges

OUR sets out method for electricity wheeling charges

Sunday, August 09, 2020

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KINGSTON, Jamaica — The Office of Utilities Regulation (OUR) has set out a methodology for determining charges for electricity wheeling and the process for allocating system losses to self-generators.

Electricity wheeling allows people who generate excess electricity in one location to be able to use the credit obtained from the Jamaica Public Service (JPS) at another site.

Wheeling charges or rates refers to the amount that the OUR determines is to be charged by JPS for the transportation of electricity across the grid by an independent party.

The OUR said is decision, which took effect on July 31, is for the 2019 – 2024 rate review period.

It noted that the determination does not specify the actual wheeling charges, as this is to be determined as a part of a separate process after it reviews JPS' 2019 – 2023 rate review application now before it.

The key decisions in the Electricity Wheeling Tariff Methodology Determination Notice include:

  1. The Postage Stamp methodology to be used to determine wheeling charges on the transmission and distribution networks.
  2. The annual transmission costs derived from the OUR's analysis of JPS's Cost-of-Service study to be used to determine the transmission and distribution costs in the calculation of wheeling charges.
  3. Information on monthly billing: Wheelers are to be billed monthly in Jamaican dollars for wheeling and other associated services. The bills shall be subject to the same base exchange rate, billing exchange rate and foreign exchange adjustment factor applicable to JPS's regular customers.
  4. Connection Compliance: In connecting to the electricity network, self-generators shall do so in compliance with the Electricity Sector Book of Codes.
  5. Application Process: Qualified individuals and organisations may apply to the Minister with responsibility for Energy for Wheeling Licences.
  6. Wheeling qualification: To qualify for a Wheeling Licence, the applicant for the service must be a Self-Generator providing firm capacity and has an average annual demand of 1MVA.

The OUR's determination notice follows the November 4, 2019 publication of a consultation document which solicited comments on the various methodologies available for consideration in the setting of tariffs for electric power wheeling.

The Electricity Licence, 2016, provides for the movement of electricity across the national grid by self-generators based on tariffs that are cost reflective and consistent with the price controls as approved by the OUR.

The aim of this service is to promote greater competition in the electricity sector and provide more options with regard to the source of electricity to the consumers of electricity.


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