The Tribune

By YOURI KEMP

and NEIL HARTNELL

Tribune Business Reporters

Super Value’s owner says he is prepared to sacrifice short-term for long-term gain if Bahamas Power & Light’s (BPL) extra 15 percent debt servicing charge helps create reduced bills long-term.

Rupert Roberts told Tribune Business BPL had to be “restarted again”, as he backed the National Utility Investment Bond fee - equivalent to 15 percent of a consumer’s monthly consumption rate - that will be added to bills come March 2020.

“I welcome that for it to go down 50 percent afterwards,” he said. “You know we have a super power plant, and if they run that right then our blackout problems are solved after 50 years. I know the Martians used to look down every night and laugh at our island in darkness, and now we have cured it I don’t know what they are thinking?”

“They had to get it restarted and get it right. Nobody wants to pay 15 percent, but I think BPL and the government have pulled a miracle, because it takes that 15 percent to make it work. That’s my thoughts.”

Mr Roberts spoke out after Dr Donovan Moxey, BPL’s chairman, finally clarified that the National Utility Investment Bond fee, which will service BPL’s new $650m debt, will be calculated as a percentage of every business and household’s energy consumption.

Many observers are likely to view BPL and the government as having been less than forthcoming on how much extra the private sector, especially, and many residential consumers will now have to pay to bail-out the state-owned utility monopoly from years of mismanagement, waste, inefficiency and corruption that brought it to near-collapse.

BPL’s advertisements have focused on the $27 increase that the “average household” will pay, giving some the impression that the debt servicing cost is a flat fee rather than a percentage, while ignoring how much the private sector will have to pay. It is also unclear whether the debt servicing charge will be calculated just on the consumption, or if VAT is included in the base, too.

Those with the largest monthly bills, such as hotels, food stores and companies where electricity has to be on 24/7, could thus find themselves potentially saddled with a significant hike in their electricity bills come early 2020 as the price Bahamians must pay for paying the interest/principal due to foreign and local investors who buy into the $650m bond issue that will refinance BPL.

Paul Maynard, the Bahamas Electrical Workers Union’s (BEWU) president, told Tribune Business he agreed that the state-owned utility had tried to lull consumers into a false sense of security over the debt servicing charge’s impact by focusing on the $27 for the “average household”.

“It’s a big increase,” he said. “Everybody is saying: Here comes the shoe. It’s dropped now. That’s the noise I’ve been hearing all day. This is not what people were led to believe. I said to BPL that you’ve got to be honest with people; you cannot pull figures out the sky. Businesses have got to plan. That 15 percent for a small business could be the difference between staying in business and having to pack up.”