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Electricity rates

Michael Briguglio (‘Up in arms’, August 4), presented a comprehensive overview of the rates ARMS Ltd has for different brackets of consumption, whereby the annual cumulative consumption is being billed every two months or so pro rata.

This means that many consumers do not benefit from the lower brackets for lower rates given the short period of time being considered.

Furthermore, ARMS does not allow consumers to carry forward discounts, which eventually results in consumers, mostly unwittingly, overpaying for their consumption, which results in additional income for Enemalta.

This method seems not only quite costly, having to compute the bills for thousands of consumers at least six times a year, but also unfair to consumers.

Enemalta/ARMS should take note of what their colleagues do in The Netherlands. In a nutshell, this is how it works.

Every year, the provider considers the overall consumption for the previous 365 days and works out an estimate for the next 365 days. The consumer is charged every month a fixed amount equivalent to one-twelfth of the estimated annual consumption payable by automatic bank transfer. That means no administration costs. Once a year, the provider works out any deviations in actual consumption and a debit/credit invoice is raised.

Rather than certain bands of consumption being charged at reduced rates, as happens in Malta, most Dutch providers have special reduced rates for power consumption in off-peak hours in the evening and extremely low rates during the night.

This is a far more realistic, efficient and cost-effective system and causes less damage to the environment.

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