Are DOMLEC and government headed for the courts

Arguments are heating up between the Dominica Electricity Services Ltd (DOMLEC) and the government of Dominica over the new Electricity Supplies Act leading to widespread speculation that the matter may have to be settled in court if the two sides cannot reach an amicable compromise.

The new Energy Supplies Act proposes to fully liberalise the energy sector and slash DOMLEC’s license by ten years, setting a new expiration date of 2015.

The power company however has argued that the new arrangements will jeopardize its long-term profitability and ability to raise the required financing for long-term investments. DOMLEC Chairman Robert Blanchard told reporters earlier this week the act will “prevent DOMLEC from making the kind of investments it wishes to make to help bring down rates over the long-term. The shortening of DOMLEC license has presented and will continue to present serious obstacles to our ability to attract financing at the most competitive rates which will also affect the rates that consumers pay.”

DOMLEC also claims that the government has failed to pay up a six million EC dollar debt and suggested the government's failure to pay is having a "detrimental effect" on Dominican consumers, and may cause the cost of electricity to rise even higher in the long run.

Government however has maintained its position that DOMLEC has had more than enough time to get its act together. They assert the company has demonstrated very little commitment to investing in the sector in a way that will bring long-term improvements to the power grid and benefits to consumers. Businesses and households across the island continue to face frequent blackouts and power outages as a result of load shedding.

Prime Minister Skerrit also categorically denied government owes DOMLEC six million EC dollars.

DOMLEC’s plea for government to rethink its position has so far fallen on deaf ears. Company officials are clearly frustrated. Their public rhetoric is taking on a more acrimonious tone. Blanchard revealed that DOMLEC was exploring its options and had retained local, regional and international counsel in the event of the government’s failure to get the message. “We do feel that we have legal options” he said. “I don’t want to start with legal options…this is certainly not my hope…but the possibility of legal action is there.”

Prime Minister Roosevelt Skerrit however responded with equal force charging DOMLEC of “seeking every opportunity to wage war against the state.” He insisted that his government would not be intimidated. Speaking on radio he assured the nation “we will put the machinery of the state in defense of the people of Dominica at anytime and at any cost. Nobody must come to Dominica and think they can threaten this country.”