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NIGHTCLUB OWNERS FEEL BITE OF JPS DEMAND CHARGES Featured

Archive Written by  AKA Thursday, 25 August 2011 02:09 font size decrease font size increase font size 0
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Nightclub operators are feeling the sting of JPS as they have been hit with exorbitant light bills, and even in cases where they have closed their establishments for renovations or for other reasons, they are complaining of a shocking "demand charge". However the company is contending that this demand charge is just an "international best practice" and is simply the cost of doing business in a competitive economy.

"My nightclub closed for four weeks to do renovations and put in a new sound system and I was still hit with a charge of $310,000." one nightclub owner told one876entertainment.com

However, a JPS released explained that in setting the rates for utilities all over the world, regulators usually include a demand charge, which is applicable to large commercial and industrial customers.

The company said that in Jamaica the demand charge is applicable to large business customers in the rates 40 and 50 categories, and is a reserve-capacity charge that is typically associated with the cost of ensuring that adequate generating, transmission and distribution capacity is available for these customers.

"It is applied to ensure that the utility has capacity in place to match the maximum peak kVA demand of its customers. That is, the maximum flow of electricity used at any one time by a customer," said the JPS.

"The principle is that, even though the customer is disconnected for non-payment, JPS is still obliged to 'reserve' capacity for the customer, so it will be available to the customer when he is reconnected. If, however, the customer terminates the account, then there would be no need for any provision for reserve capacity for this customer. As such, the demand charge is applied as long as a contract exists between JPS and the customer," added the company.

Another popular nightclub owner told one876entertainment.com that he closed his nightclub for five weeks before reopening under a new name and he was hit with a "demand charge of 280,000".

"International best practice is that a customer pays a demand charge for reserve capacity for six to 12 months, a period which is determined by the local regulator. In Jamaica, the standard period is six months," said the JPS.
 

Read 1716 times Last modified on Friday, 26 August 2011 00:56

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