Refinance MEA loans / bonds at lower interest rate

The MEA loans / bonds (around 500 million I understand) have an interest rate of 5% (I have been told). If we paid that off with another loan which had a lower interest rate, we could save many millions. 

Of course we could see if this applies to any other loans / bonds

Why the contribution is important

We are spending millions a year on servicing the interest on this debt. The costs are going on the water rates which is not related to ability to pay, income of household etc... Even those with very low incomes have to pay their rates...I.e. It is not a progressive tax. Easing these burdens would improve public morale...

by ThurstonArrowsmith on May 14, 2017 at 11:47PM

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  • Posted by dpfellows May 15, 2017 at 12:36

    The last MUA annual report stated:

    "Interest on Isle of Man Government Treasury Consolidated Loans Fund advances (see Note 18) was set at 1.0% (2014-15: 0.0%). With e ect from 1 April 2016 the rate has been set at 1.5% and is expected to rise to 2.0% with e ect from 1 April 2017."

    One issue that I think needs pushing is maximising the generating capacity of the MEA. At present exports of electricity are about 18% of power generated and it has been reported that there is about 40% spare generating capacity at Pulrose. Increasing profitable sales of power out of the fixed capital costs of the plant should be a major priority.
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