Belco has sought permission from the Energy Commission to increase its base tariff rates, starting next year.Residential customers would see a 3.5 percent average rate increase through 2014 if the company’s proposal is approved.The rate would increase by five percent for commercial demand customers and 3.75 percent for small commercial customers, according to a press release issued by the company today.The increase is needed to support an anticipated $300 million Belco is expected to pay to replace ageing equipment over the next ten years, a spokeswoman said.“Belco did not increase rates in 2011, although it had approval to do so, due to economic conditions on the Island. The company is concerned about the public interest and is, therefore, proposing rates that have been benchmarked against the Consumer Price Index (CPI) to keep them close to CPI.”She continued: “Belco is requesting the increase because the company will need to spend some $300 million over the next ten years to replace ageing equipment that has reached the end of its operational life and to add capacity to meet customers’ needs, ensuring that Belco’s system remains flexible and redundant. Capital expenditure is required both in the central plant and on the transmission & distribution system, which will also be upgraded to incorporate large- and small-scale renewable energy sources.“In the past, Belco was largely able to avoid rate increases and finance operations and capital expansion from income growth that was achieved by kWh sales growth and cost containment efforts. Belco continues to make strides with respect to cost containment. However, stagnant electricity sales have led the company to submit the application for rate increases to ensure a strong fiscal platform that can support the debt financing costs of the capital replacement programme. As has been Belco’s practice, the company will not increase rates, if income levels are appropriate to sustain its requirements.”Residents have until 5pm on November 30 to make written submissions regarding the proposal to the Energy Commission.Submissions should be delivered to The Energy Commission c/o Department of Energy, 2nd Floor, FB Perry Building, 40 Church Street, Hamilton or mailed to The Energy Commission, PO Box HM 101, Hamilton HMAX. They can also be e-mailed: energy[AT]gov.bm.More information on the application can be found at www.belco.bm, and at Belco’s Serpentine Road headquarters. Information is also available from The Department of Energy, located on the 2nd floor of the FB Perry Building at 40 Church Street, and on the Energy Commission’s “Filings and Decisions” webpage, www.energy.gov.bm.