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Belize Energy Sector Diagnostic PUC 30 Butane and propane are imported separately85 and mixed by the distributors in country for the consumer market. Mixing is necessary to ensure the butane product sold has enough “pressure”86 to satisfy the main applications.87 The mix formula depends directly on the application. For example the butane product sold to households for cooking is generally a 60/40 propane/butane mix, while the product used for industrial applications is a 70/30 propane/butane mix.88 Propane is sold separately if requested, although the demand for pure propane is extremely small.89 For the most part, butane90 is sold bundled with a tank (deposit paid) and customers pay one price for a single product. Tanks come in varying sizes and consumers can choose to purchase the bundled product from the butane supplier or to purchase the items separately. Like the oil and gas distribution markets, GOB, through the Ministry of Commerce and Industry mandates the selling price for butane, see Annex 8 for formula and district schedule.91 The retail price changes if there is an increase or decrease of $4.00 or more in the landed price.92 According to the Ministry of Commerce and Industry, the price per district varies because of the costs associated with transportation. Thus costs depend to a large extent on where a company sources its supply, the distance from the supply to the reservoir and finally the distance from the reservoir to the local agent. For example Orange Walk and Corozal signal the lowest butane prices. This is likely because both companies operating in that area source from Mexico and have reservoirs either in Orange Walk or Corozal. However Belize City and Belmopan, where prices are $1 – 2 dollars above the Northern districts, are supplied to a large extent by BWEL, who has depots in Hattieville, Ladyville and Belmopan, but sources its supply through its parent company in El Salvador. They in turn source from the US and or Venezuela. In the most recent price adjustments released by the GOB in September of 2003, Dangriga and Punta Gorda prices remained unchanged since the purchase price for the main supplier to those districts i.e. Southern Choice, did not change.93 Operators in this sub-sector are able to compete on quality and service. For new entrants, brand identification and loyalty could be a factor and again opportunities to exploit economies of scale are limited. Regulatory Environment Like the situation in the petroleum products industry, research could discern no coordinating authority, regulatory organization or Ministry with oversight responsibilities for LPGs, although again, the Ministry of Transport et. al., is responsible for the energy 85 although only butane requires an import license, per Ministry of Commerce and Industry, John Banner, Price Control Officer, Oct. 27 2003. 86 Angel Matus per John Banner, ibid. 87 Angel Matus, BWEL as told to John Banner, Price Control Officer, Ministry of Commerce and Industry, Oct. 27, 2003 88 Angel Matus, BWEL as told to John Banner, ibid, 89 Angel Matus, BWEL as told to John Banner, ibid 90 referent of butane mix 91 The prices quoted in this report are for the most popular tank size i.e. 100lb or 22 gallon tank. Other standard sizes are 50 and 25 lbs. According to Ministry of Industry and Commerce, prices for these sizes are based on the price for 100lb. Thus a 50lb would cost 1⁄2 of the 100lb and the 25 lb, 1⁄4 of the hundred pound. 92 Personal Communication, Ministry of Industry and Commerce, Ms. Elsy Reyes (Secretary to the Director), August/Sept 2003 93 Glenda May Martinez, Administrative Officer, Ministry of Industry and Commerce, Personal Communication, October 3, 2003PDF Image | Energy for Sustainable Development Toward a National Energy Strategy for Belize Energy Sector Diagnostic
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