Akash Sama­roo

Se­nior Re­porter

akash.sama­roo@cnc3.co.tt

Busi­ness groups are warn­ing that a tough 2024 awaits the pub­lic, as some say they will have no choice but to pass the elec­tric­i­ty rate in­crease on­to their cus­tomers.

While “Com­mer­cial B1 Cus­tomers” will see the per­cent­age in­crease in their bills re­duced from the pre­vi­ous range of around 51 per cent to 63 per cent to a range of 37 per cent to 51 per cent, oth­er com­mer­cial cus­tomers will see an in­crease be­tween 10 per cent to 11 per cent.

The Reg­u­lat­ed In­dus­tries Com­mis­sion (RIC) ex­plained to Guardian Me­dia that B1 cus­tomers are usu­al­ly small to mid­size en­ter­pris­es (SMEs) with a low­er con­sump­tion than larg­er busi­ness­es.

How­ev­er, San Juan Busi­ness As­so­ci­a­tion (SJ­BA) pres­i­dent Ibrahim Ali yes­ter­day said any ad­di­tion­al in­creas­es in op­er­a­tional costs will have a se­ri­ous ef­fect on busi­ness­es that are al­ready reel­ing from oth­er ex­ter­nal pres­sures.

“Crime has af­fect­ed busi­ness­es in San Juan, this has car­ried up costs for se­cu­ri­ty, for cam­eras and ex­tra per­son­nel and now you must look at elec­tric­i­ty and what’s go­ing to hap­pen. You look at the min­i­mum wage mov­ing to $20, but those few dol­lars will be ab­sorbed in ad­di­tion­al costs. You have the cost of goods and ser­vices and food that are ex­pect­ed to rise by Christ­mas by 15 to 20 per cent. It is dif­fi­cult for busi­ness peo­ple right now,” Ali sug­gest­ed.

He said un­for­tu­nate­ly, con­sumers will feel the im­pact.

“No busi­ness own­er ever ab­sorbs cost. When you look at the small busi­ness man, the taxi dri­ver, when gaso­line goes up, he rais­es his fare by at least 1 dol­lar, even if it in­creas­es by a dol­lar per gal­lon or litre. The thing is, cost is al­ways car­ried over to the con­sumer, so they feel the pinch and you have a lot of peo­ple un­em­ployed at this time. It is go­ing to be a dif­fi­cult year ahead of us,” he lament­ed.

This sen­ti­ment was shared by To­ba­go Cham­ber of In­dus­try and Com­merce (TCIC) chair­man Cur­tis Williams, who said al­ready, there are con­cerns that land­lords will be rais­ing rent for busi­ness ten­ants. Williams ques­tioned the tim­ing of the in­crease and if it will have the de­sired im­pact.

“We al­so think about the ef­fi­cien­cy of T&TEC. T&TEC will get more rev­enue, but they’re just prob­a­bly go­ing to spend and waste more mon­ey. There are a lot of loop­holes in their op­er­a­tions, but I think they can do a bit of cost sav­ings. All of these things are hit­ting us one af­ter the next, min­i­mum wage, T&TEC, we know WASA is on the edge and prop­er­ty tax, so can you imag­ine what is hap­pen­ing in 2024? There will be sev­er­al in­creas­es hit­ting the busi­ness com­mu­ni­ty, so prices will def­i­nite­ly go up. We have no choice about that,” Williams warned.

In San Fer­nan­do, Greater San Fer­nan­do Area Cham­ber of Com­merce (GS­FCC) pres­i­dent Ki­ran Singh said while SMEs were spared the ini­tial in­crease pro­posed by the RIC, many small busi­ness­es will still have to face the in­crease for res­i­den­tial rates.

“These house­holds, these res­i­dences tend to have cot­tage in­dus­tries, this is where the SME sec­tor starts tra­di­tion­al­ly, the per­sons who make pies, who cater, who of­fer var­i­ous goods to these small­er cus­tomers, and this is go­ing to cause in­fla­tion­ary pres­sure through­out the coun­try be­cause elec­tric­i­ty dri­ves the pro­duc­tion process in al­most every­thing we pro­duce,” Singh ex­plained.

Singh said they thought the State would have un­der­stood the cur­rent eco­nom­ic cli­mate and de­layed the im­ple­men­ta­tion of an in­crease.

“We al­ready have the im­pend­ing prop­er­ty tax, in­crease in min­i­mum wage, fu­el price in­crease over the years and we just came out of the pan­dem­ic, we were ex­pect­ing some time to breathe, to cov­er some ex­pens­es with the up­com­ing Di­vali, Christ­mas and Car­ni­val sea­sons and then maybe a grad­ual in­crease in the elec­tric­i­ty rate over a pe­ri­od of time,” Singh ar­gued.

Singh said while busi­ness­es in San Fer­nan­do un­der­stand the util­i­ty had to in­crease rates, there needs to be a bal­ance with op­er­a­tional ef­fi­cien­cy.

“When we have a pow­er out­age, as a small busi­ness we don’t get any re­bates, we have ap­pli­ances that gets dam­aged, food that has to be thrown away, but they ex­pect us to agree to a rate in­crease with­out any con­sid­er­a­tion to in­creas­ing the ef­fi­cien­cy of the elec­tri­cal ser­vice to us,” Singh added.

But the San­gre Grande Cham­ber of Com­merce (SGCC) said it will be dif­fi­cult for busi­ness­es there to pass on any added costs to the peo­ple from that area.

“We have a lot of low-in­come peo­ple in San­gre Grande, this is the poor­est part of the coun­try. When util­i­ty rates go up, the busi­ness­es face an ad­di­tion­al cost that we will have to bear but a lot of busi­ness­es won’t want to push that on to con­sumers be­cause things are al­ready tight, so we must look at ways at cut­ting costs in our area,” said pres­i­dent Wayne Hug­gins.

How­ev­er, Hug­gins said there is room for op­ti­mism.

“We knew the rates haven’t in­creased in a while so peo­ple were ex­pect­ing it, but the nice thing about it is that the re­cent im­prove­ments in terms of the fu­ture for for­eign ex­change through the Drag­on Gas field and the Lo­ran-Man­a­tee, that is a pos­i­tive thing, busi­ness­es are hap­py be­cause it will put an ease on for­eign ex­change with more in­come com­ing in­to the coun­try and you will get more eco­nom­ic ac­tiv­i­ty down the road,” Hug­gins ex­plained.