In 2004, power distribution companies benefited from being able to increase consumer rates to their paying clients, and thus did not have to work harder to reduce the number of non-paying clients. Paying consumers continued to be penalized for the inefficiencies of EdeSur, EdeNorte and EdeEste, and had to pay 55.4% more for the service, despite the deficient service.
According to a report in Diario Libre, the constant increases in electricity bills enabled the power distribution companies to increase their revenues 24.6%, even when power consumption dropped 19.5% and production declined 16.8%. At the time, the transmission losses and losses for non-paying consumers went from 38.4% in 2003 to 40.4% in 2004, according to a recent Central Bank year report.
The sector most affected by the power increases was the industrial sector, which suffered tariff hikes of 83.7%. The residential sector paid 28% more, and commerce was billed 58.3% more.
Meanwhile, Yandra Portela, president of the Association of Industries of the Dominican Republic, told Hoy newspaper that the Superintendence of Power has notified them that they will not be applying the Electricity Law provision that enables large consumers to benefit from reduced rates. The Superintendence argues that the finances of the power distribution companies do not permit them to release their better paying clients. The provision in the law enables the large companies to connect directly to the grid, purchasing directly from the power generation companies, and bypassing the power distribution companies. At the present time, the high cost of power is one of the greatest obstacles, if not the greatest, affecting the competitiveness of the industrial sector in the DR.
Economist Carlos Asilis recently said that the DR should concentrate on services that are not power-intensive, given the deficient and costly energy sector.