22278: Durban: Electricity and Slavin's Miami Herald Op-Ed (fwd)

[Bob Corbett <corbetre@webster.edu>]

From: Lance Durban <lpdurban@yahoo.com>

I thought Patrick Slavin's recent Miami Herald Op-Ed piece was
pretty good, and forwarded it to a couple people in the States
who are not on the Corbett List.  One of them responded...

   good article but hey, the guy's blithe suggestion that
   the U.S and France can easily underwrite the 2 million
   dollar monthly expense of fueling Haiti's electrical
   generators?  What are we...now required to supply
   creature comforts to every failed state on the planet?...

On second thought, while recognizing the importance of doing
something about the dearth of electricity in Haiti since the
departure of President Aristide, my U.S. correspondent does make
a good point.  Electricity has measurable value, and Haitian
consumers (not Uncle Sam) ought to be paying for it.

Ed'H is meeting an ever-diminishing percentage of the public
demand for electricity and should have been re-organized or
privatized long  ago.  There are very few private sector
businesses with (1) a guaranteed demand by consumers willing and
able to pay AND (2) pretty much the right to charge whatever it
wants.  That Ed'H is still unable to supply the product in
sufficient quantity is indeed a sad commentary on its
management.

Three years ago on this list, I related hearing that an Ed'H
official had acknowledged that less than 50% of the residential
electricity is paid for and that even commercial collections had
dropped to around 80%.  This official had gone on to complain
that poor collections were really a political problem (pa faute
moin!) since Ed'H  trucks were increasingly afraid to disconnect
unauthorized connections in poorer neighborhoods for fear of
being stoned (or worse).  What was required, he maintained, was
police escort for the Ed'H trucks doing the disconnecting.

Unfortunately, as long as Ed'H is a government entity, cutting
off non-payers may be a political hot potato.  That's a pity,
because a business that cannot collect for its product is not a
viable business.  The Ed'H solution has been to try and bill the
people who do pay their bills even more.  The result is that
many of the few remaining factories in-country routinely provide
all of their own power even when Ed'H is "on".

To quote my Corbett post of three years ago...
    a big house in the hills above Petionville connected
    to Ed'H but with an inverter system and generator for
    back-up pays about US$.12 to .13 per KWH these days
    (June 2001).  A moderate-usage factory near the
    industrial park next to the airport pays Ed'H around
    US$ .21 to .22 per KWH.  Now, assume the factory runs
    a 250 KW generator (costing US$23,000 in Miami) with an
    assumed 6 year lifespan, the cost of spare parts and
    regular maintenance, and the current price of diesel.
    Voila, this factory can generate ALL of its own power
    for around US$.15-.18/KWH.... Gradual loss of its prime
    base of paying customers ought to be a concern of Ed'H,
    yet I wonder if they have even noticed.

These days, of course, no business can survive without
generating virtually all of its own power, since Ed'H is
supplying almost none.

What course of action would I today recommend for Ed'H?  The
first thing is to generate more power.  That's where foreign aid
may be needed to prime the pump.  But, that's the easy part.

Secondly, Ed'H needs to start collecting from its customers and
penalize those who do not pay with summary disconnections.  To
prevent those illegal hook-ups from rapidly re-appearing, don't
just disconnect them, disconnect them and shoot a 220 volt
charge down the line to permanently disable the illegally
connected fridge, TV, clock, or whatever!  Arguably a
popularly-elected President would have an easier time of
administering this bitter medicine than the present government,
but the job needs doing.   I am betting that there would be
relatively few burned out refrigerators, TV's, radios, etc. as
people hastened to either:
   1.  disconnect on their illegal hook-up on their own
   2.  sign up for a legal counter
   3.  cut a deal with a 'legal' neighbor to tap into
          Ed'H power running through his counter.

To offset the hard feelings caused by cutting off the illegal
connections, Ed'H might combine it with installation of
additional street lights in those affected neighborhoods.
That's good for "security" and was one of the more popular
Aristide programs, even if it was extremely limited in scope.

Lance Durban