Saint Lucia: LUCELEC reduces July fuel surcharge following lower global fuel prices

Castries, Saint Lucia: Saint Lucia: St. Lucia Electricity Services Limited (LUCELEC) has reduced its fuel surcharge for July, bringing relief to customers following a decline in the company's fuel costs. The lower surcharge will be reflected on electricity bills issued this month.

LUCELEC has announced that the fuel surcharge for the month of July has been reduced to EC $0.225 per kilowatt-hour (kWh). It has come down from EC $0.308 per kWh from the previous month. The company explained that they have paid a lower price for fuel in the month of June after the easing of geopolitical tensions. The global crude oil prices dropped significantly because of geopolitical changes and increased oil supplies.

The fuel surcharge is a separate charge on customer’s electricity bills that covers the expenses for electricity generation. This surcharge is reviewed and adjusted each month because the fuel prices are not stable. The fuel prices fluctuate because of global market changes and it affects the overall expenses the companies or governments spend on electricity generation.

LUCELEC reminded customers that there is a one-month delay between changes in fuel prices and the surcharge that is applied to the electricity bills. This means that the fuel surcharge is charged based on the cost of fuel purchased in the previous month. And this is the reason why the lower fuel cost in June has led to a decrease of surcharge in the month of July.

According to the information provided by the company, out of many components that make up the customers’ electricity bill, the fuel surcharge is highly unstable and keeps on changing depending on international fuel prices. The other components that make up the customers’ electricity bill are fixed service charge, energy charge, and the monthly charge. These charges are relatively stable than the surcharge.

LUCELEC also noted that Saint Lucia relies on imported fuel for most of its electricity generation. And this is the reason why changes in global oil prices directly affect the cost of electricity production in the country. When global fuel prices rise, the surcharge increases to cover the additional costs. Similarly, when the fuel prices lower globally, the surcharge is decreased.

The latest development signifies that customers will experience a reduction in the fuel surcharge applied to the electricity bill in the month of July.