Grenada’s recent political transition from the New National Party (NNP) to the National Democratic Congress (NDC) has sparked a heated debate surrounding the gas cap policy instituted by the NNP before they lost the June 23, 2022 general election. The NNP in a recent press release stated that the NDC’s decision to remove the gas cap, resulted in an increase in gas prices to $16.88. However, it is crucial to examine the full story and understand the potential benefits that came with the removal of the cap.
The Gas Cap Policy:
Under the former NNP government, a gas cap was instituted, limiting gas prices to $15.00 per gallon. The policy aimed to provide relief to drivers and mitigate the impact of fluctuating global oil prices on the local economy. The NNP government proudly touted this initiative as a measure to support the population, emphasizing the affordability of fuel for Grenadian motorists. With a fixed price at $15.00 if the price dropped under, drivers still paid $15.00.
The NDC’s Decision:
Upon assuming office, the NDC made the decision to remove the gas cap, leading to an increase in gas prices to $16.88 per gallon. The move was met with criticism from the NNP, who argued that the NDC was disregarding the financial burden this placed on drivers.
The Untold Story:
While the NNP focuses solely on the increase in gas prices, they conveniently ignore the fact that, after the cap was removed, gas prices actually dropped below the previous $15.00 limit. This resulted in significant savings for drivers, countering the NNP’s narrative that the removal of the cap only led to increased costs.
The Benefits of Removing the Cap:
- Market Flexibility: By removing the gas cap, the NDC aimed to allow the market to determine gas prices based on supply and demand dynamics. This increased flexibility enables businesses to respond to changing market conditions and maintain a stable supply of fuel.
- With the cap drivers were paying more when the price dropped under $15.00. Now when the price drops drivers will pay less which is the actual price.
- Economic Impact: The government collects $5.00 tax on every gallon of gas, so now they continue to collect that tax even when the price increase or decrease.
- If the NNP wanted to give drivers some relief in gas price they could have cut the tax from $5.00 per gallon to $4.00. The truth is that motorists were not saving by a fluctuation in price over $15.00 and under $15.00.
Conclusion, while the NNP government continues to criticize the NDC’s decision to remove the gas cap, it is essential to consider the full story. The removal of the cap resulted in gas prices dropping below the previous $15.00 limit, providing savings for drivers. Moreover, the move towards a more market-driven approach has the potential to stimulate economic growth and enhance efficiency within the energy sector.
As the debate continues, it is crucial to analyze the long-term impact of the gas cap policy and evaluate whether the benefits of removing it outweigh the initial concerns raised by the NNP.
It is time for the government to look into alternative sources of energy so we can reduce the dependency on fossil fuel. Wind and Solar are good choices to explore.
By T.L. Neckles