The Tribune

By Neil Hartnell

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamas Power & Light’s (BPL) Board will meet today to discuss the timeline for rolling-out utility-scale renewable generation across the Family Islands as it targets “two for the price of one”.

Dr Donovan Moxey, the state-owned utility’s chairman, told Tribune Business that BPL was seeking improved efficiency and cost reductions from an initiative that is designed to also move The Bahamas’ closer to the National Energy Policy’s (NEP) renewable targets.

With the NEP mandating renewable energy sources account for 30 percent of The Bahamas’ generation mix by 2030, Dr Moxey said the development and issuance of requests for proposal (RFP) for each Family Island was “high on our agenda”.

One such RFP, seeking private sector bids on a solar generation facility for hurricane-ravaged Ragged Island, is expected to be issued shortly. Prime Minister Dr Hubert Minnis last night revealed that groups have already been “shortlisted” to participate, with the facility expected to be constructed by year-end.

Describing the Family Islands as BPL’s “lowest hanging fruit” for utility-scale renewable energy, Dr Moxey said both board and management were still working through various technical, economic and other issues to determine the best solutions for other locations.

With each island’s geography and energy demand different from the others, he explained that investment levels, required generation capacity and costs would differ on a case-by-case basis - an issue BPL is grappling with in finalising the RFPs.

Dr Moxey’s comments indicate BPL is a little further off from where Desmond Bannister, minister of works, suggested when he told Tribune Business that the Family Island renewable energy RFPs would be issued in “rapid succession”.

Mr Bannister and the BPL chairman both spoke out after meeting yesterday with David Bohigian, acting president and chief executive of the Overseas Private Investment Corporation (OPIC), the US government’s development financing arm that facilitates foreign investment by US companies.

Their talks focused on energy sector opportunities in The Bahamas, with Dr Moxey confirming that BPL was in discussions with the OPIC and other agencies on potential financing for its Family Island renewable plans.

“We met further to the Prime Minister’s meeting with president Trump,” Mr Bannister told Tribune Business of the OPIC talks, “and there were some very candid discussions about the potential to fund private sector activity in The Bahamas with respect to energy.

“We shared with them our plan to issue RFPs with respect to renewable energy in the Family Islands, and we anticipate there’s be some further discussions. They’ve indicated what they’ve done in a number of countries, and the potential for collaboration and for them to work with private sector companies.

Turning to the specifics of BPL’s Family Island renewable roll-out, Mr Bannister added: “I suspect you’re going to see a rapid succession of renewable energy RFPs throughout the Family Islands. I suspect they’re going to have one out each month coming.

“BPL, throughout the Family Islands, has engines and generation equipment, some of which are at the end of their useful life and some of which are not as reliable as they ought to be, so the opportunity to support what we have and provide renewable sources of energy throughout the Family Islands is there.”

Dr Moxey, though, confirmed that BPL was still determining “the timing and timeline” of the various Family Island RFPs given the multiple issues it needed to work through to finalise the bid specifics that will be unveiled to private sector groups and investors.

“There are a number of things we have to weigh,” he told Tribune Business, “the final engineering designs, access to resources. There are a number of things we’re looking at that will drive the timeline.

“There are quite a number of design and engineering proposals, so we’re looking at all of those to make sure it has the impact we want in terms of cost reduction on the Family Islands. We’re very cost conscious in terms of making these decisions, keeping in mind the National Energy Policy’s 30 percent renewables goal by 2030. It’s looking at timelines versus the costs involved.”

Besides the overall economic and technical issues, Dr Moxey said BPL also had to account for differences in energy demand between the various Family Islands as well as their likely future needs given the potential for major foreign direct investment (FDI) and economic growth.

“A lot of this will be discussed at the Board meeting,” he added, “and then we will have to make a decision as to how we move forward. This is extremely important. It gets us moving in the right direction with respect to the 30 percent renewables in the National Energy Policy.

“And, when you look at operating cost reduction in the Family Islands, solar is one way we can have a significant impact, especially when you’re talking about logistics, the cost of shipping fuel and the fuel side of things.”

Utility-scale renewable generation will also reduce maintenance costs associated with BPL’s existing engines, and Dr Moxey told Tribune Business: “The Family Islands are really the lowest hanging fruit for us.

“We’re looking at increased efficiency and reduced costs. This is one of the ways we can get two for the price of one in terms of efficiency and cost reduction. The transmission and distribution network is not as complex as what we have on New Providence, and as a result we can have a much more meaningful impact with renewable energy on the Family Islands.”

Dr Moxey said it was too early to determine the total cost savings and necessary investment required, or the island-by-island breakdown. However, he said any savings would be spread across BPL’s entire customer base - not just confined to a single island - due to the utility’s billing and network structure.

“Our costs have always been shared across the network from day one,” he explained. “That’s how BPL was set up and operates.”