JIS News

Story Highlights

  • The Minister with Responsibility for Information wishes to clarify recent reports in the media based on a News Release from the Office of Utilities Regulation (OUR) alleging the OUR was not apprised of the contents of the Bill establishing a new governance framework for the agency.
  • These reports do not present the complete facts.
  • The OUR, the Ministry of Science, Technology, Energy and Mining (MSTEM), Jamaica Public Service Company (JPSCo), the Electricity Sector Enterprise Team (ESET) and the Office of the Cabinet were involved in the consultations with the independent World Bank consultant carrying out the Study.

The Minister with Responsibility for Information wishes to clarify recent reports in the media based on a News Release from the Office of Utilities Regulation (OUR) alleging the OUR was not apprised of the contents of the Bill establishing a new governance framework for the agency. These reports do not present the complete facts. 

Earlier this year, a best practice examination of the legal and regulatory framework of the OUR was embarked upon following concerns expressed by investors about a perceived lack of objectivity in the OUR’s governance and decision-making, and with Jamaica facing the possibility of being brought before the International Centre for Settlement of Investment Disputes, ICSID. Assistance for the conduct of this Electricity Licence and Regulatory Best Practices Framework Study was received from the World Bank. 

The OUR, the Ministry of Science, Technology, Energy and Mining (MSTEM), Jamaica Public Service Company (JPSCo), the Electricity Sector Enterprise Team (ESET) and the Office of the Cabinet were involved in the consultations with the independent World Bank consultant carrying out the Study. 

In August, at about the time that Cabinet received a submission from the ESET along with recommendations from the World Bank Report, the OUR indicated that its continued involvement in the best practices review would require written communication, essentially withdrawing itself from further participation in the face-to-face review process, as mandated by the Cabinet.  It is to be noted that the OUR remains the only stakeholder that has not provided any written comments on the World Bank Report, a copy of which was provided to all stakeholders, including the OUR, in June. 

At the sametime, the OUR has over time, put forward various proposals for a comprehensive review of the OUR Act to take account of policy changes in the sectors under its jurisdiction – the most recent of such submissions being received by the Cabinet Office in May 2015. 

While these iterations have been given due consideration, with the significant changes to the regulation of the telecommunications sector presently underway, it was not deemed either practical or prudent to proceed at this time with a comprehensive revision of the OUR Act. 

In order to reduce any likelihood of a successful claim being filed before ICSID and ensure the feasibility of the immediate development of new efficient baseload generating capacity, including the diversification of fuel to include Liquefied Natural Gas (LNG), the decision was taken to expedite the best practice recommendations in the World Bank study. 

The OUR (Amendment) Act passed in the House of Representatives on October 13 and subsequently in The Senate, last Friday, therefore, sets out the new governance best practices framework for the OUR generally, and the electricity sector in particular. This does not in any way discourage or prevent the further adjustment to the OUR Act as may be warranted in the near future.