Barbados Braces for Significant Electricity Bill Increase Amid Clean Energy Investment: Key Insights Revealed

Three intervenors representing consumer interests and the green energy industry in the rate battle with the Barbados Light & Power Company have warned Barbadians to brace for a substantial increase in electricity bills, with at least one suggesting a jump as high as 26.2 per cent.

The warning comes after the Fair Trading Commission (FTC) on Tuesday ruled on a request from Light & Power to pre-approve three of the power company’s five proposals to invest in battery storage and recover the cost from customers through the Clean Energy Transition Rider (CETR). It partially approved a fourth plan and rejected the other. The regulator gave the green light 15 megawatts of the requested 90MW Battery Energy Storage Systems (BESS).

Veteran utility analyst Ricky Went warned that as a result, the average customer bill will experience an increase between 20.7 per cent and 26.2 per cent.

“It is expected that the proposed assets will not be all commissioned at the same time, and as the assets are proven used and useful, the rider is recalculated and revised upwards. As a result, the impact of the investments on the customers is moderated to some degree,” he said, quoting the commission’s ruling.

The analyst said the impact on the customer bill ought to be further considered in light of two key international statistics: The cost of electricity in Barbados compared to other electricity rates paid by consumers and businesses are among the highest in the world, and carbon dioxide emissions by Barbadians are amongst the lowest in the world.

Opposition senator and lawyer Tricia Watson also placed consumers on alert for a possible legal loophole to allow rate increases beyond those from Tuesday’s FTC decision.

“The people of Barbados should not stop paying attention,” she urged.

Watson argued that if the utility’s Canadian owners Emera find it unacceptable, they may try to get rates approved under the December 2023 amendment to the Utilities Regulation Act that allows the energy minister to bypass FTC regulation.

She claimed that most households will bear all of the cost burdens, which will be “tremendous”, and will reap none of the benefits which will make some elite players “very wealthy at the expense of ordinary consumers”.

And the utility lawyer told consumers not to be fooled into thinking that the regulator had saved them from a rate increase.

“Whatever was approved by the FTC this time around will still result in electricity rate increases for Barbadians. That is on top of the 2022 interim rate increase, and possibly on top of another $10 million per year rate increase that Light and Power asked for in January this year and that the FTC is reviewing right now,” she said.

Stephen Worme, vice president of the Barbados Renewable Energy Association (BREA), said while the FTC got “some things right”, he believed limiting battery storage was not in Barbados’ best interests as it is “a critical element needed to restart the renewable energy transition which has been stalled for some time”.