The Tribune

By Malcolm Strachan

IN the vein of offering safety tips, let me offer these three pieces of advice to avoid an electric shock – never work around electricity when water is present, always shut off the power before working on live circuits and never, ever open your Bahamas Power and Light bill.

I made the mistake of opening mine this weekend only to find a 28 percent increase on the previous month with no major difference in usage in my household. What about air conditioning in this heat, people might say, but they don’t know how my family likes to burn that year round. At least this summer it’s justified.

I’m far from the only one to have been commenting on the increase in electric bills and it seems I’m getting off lucky – former Cabinet minister Dionisio D’Aguilar was quoted last week as saying his rate has gone up from 24 cents per kilowatt hour in October last year to 41 cents, a rise of just under 71 percent.

He made further good points that it wasn’t even as if you could rely on the electricity when you were paying that amount, with load shedding and outages meaning that businesses in particular have to factor in the costs of owning and running generators to make up for the times when BPL just can’t cut it.

He said: “I don’t know how businesses are coping. It’s just that, on top of that, you’ve got an intermittent power supply and, while we may have back-up generators, you have to service them and maintain them. And if there’s constant power outages - on, off, on, off - it’s doing untold damage to the electronics in your business.

“You have to go out and buy UPS to provide sufficient power between when the light goes off and the generators kick-in... those 13 seconds. You have a lot of wear and tear on your generators. You’re paying 71 percent more for power and getting an intermittent power supply that is doing untold damage to electronics in your business.”

He also talked of how power - “dirty power” that is – is “never quite the right voltage” leading to brown outs, although I do not recall him being so critical when he was in office.

He’s not the only one to be criticising, though – Ben Albury over at Bahamas Bus and Truck talked of how the BPL bill is “probably the biggest salary in the business right now”, Philip Beneby over at the Retail Grocers Association talked of food prices never returning to pre-COVID levels and pointed at BPL’s soaring electric costs as a factor. That makes sense, of course – if costs go up, then customers have to carry them or else the business is on a one-way ticket to going bust. If that is a food store, it means passing along those costs in higher food prices.

Of course there is another way rather than raising prices – and that’s cutting costs, which usually means jobs, and that’s what the president of the Bahamas Petroleum Retailers Association has warned of. Raymond Jones said: “There’ll be lots of layoffs. There will be a reduction in hours and operations. All of that’s coming in the very near future.”

You might take that with a pinch of salt – the gas retailers have said a lot in their recent dispute with government but it never seems to go much beyond talk – but the reality is that they are in a pinch already and rising costs doesn’t help in the slightest. The Fusion cinema complex too has talked of cost-cutting, without specifying details.

So how did we get here? Well, the finger cannot point towards global oil prices – they’re down by about 37 percent on a year ago. BPL’s bills have headed in the opposite direction.

Rather, you can point that finger at a decision made by the government shortly after coming into office. In September and December 2021, the government opted not to go ahead with trades under a fuel hedging policy that would have secured cut price oil for BPL. Whatever the reason for that – perhaps the funds just weren’t available – we are feeling the knock-on effect now.

The Inter-American Development Bank last week pointed out how BPL has gone from saving money to soaring bills in just three years.

It said: “In 2020, this oil hedge programme was the first-ever executed by the bank linked to two loans for the Government of The Bahamas, and it was executed at a propitious time for oil prices, thus driving dramatic savings.”

The government did keep BPL’s fuel charge down for a while – for 12 months, in fact, even though that seems to be against the regulations in the Electricity Act. Reportedly, the government now needs to recover about $90m in fuel costs, adding to the spike in BPL’s bills.

There has been no rush to comment on the current situation by the government – no one wants to be the face associated with bad news, I presume.

It will, however, be up to the government to navigate a way out of this. Falling oil prices will have helped, but right now people are hurting, and businesses are hurting.

If indeed job cuts do start happening because of cost-cutting measures, that may see a greater load put on the government and NIB in terms of support for those out of work.

The rising bills hurt everyone.

That extra money isn’t going to bolster the BPL network either – it is largely just covering costs, be it oil costs or debts – so it is not as if we are going to get an upgraded service out of the extra money coming out of our pockets.

Indeed, with senior figures warning that load shedding is possible this summer, we seem to be taking a step backwards considering how recently we were promised that was coming to an end.

Expecting a consistent electric service should not be an outlandish request in this day and age. Getting an unreliable service and having to reach deep into your pockets to fund it is a surefire way to get angry, however. And angry citizens do not make good news for governments.