The Tribune

Ministry of Grand Bahama: Proposed rate increase ‘unacceptable’ 

By DENISE MAYCOCK 

Tribune Staff Reporter 

dmaycock@tribunemedia.net

THE Grand Bahama Power Company’s (GBPC) proposal to increase electricity rates drew quick backlash from the Ministry of Grand Bahama yesterday.

The GBPC said it submitted a rate plan proposal to the Grand Bahama Port Authority for consideration on August 1. The plan is to increase the base rate for Grand Bahama customers by 6.3 percent in 2025.

The GBPC said its request would sustain operations and future investments and would help align its operations with the government’s target of 30 percent renewable energy by 2030. The GBPC said the requested 6.3 per cent base rate increase is below the country’s recent inflation rate of 7.3 percent.

“Balanced with the company’s effective fuel purchase strategy, which brings rate stability through 2027, the proposed rate change would result in a small all-in decrease for most electricity customers,” the GBPC said. “The all-in rate includes all elements of monthly electricity bills, including the fuel charge.”

GBPC Chief Operating Officer Nikita Mullings said the proposed rate change would not affect the fuel portion of monthly electricity bills, so 40 percent of the bill would remain unchanged.

“With the impact of our fuel hedging programme, residential, general service large, and large industrial customers are forecasted to receive a small reduction on an all-in basis, while commercial customers will see a small, estimated increase of less than two per cent,” she said.

If approved, the base rate change would take effect on January 1, 2025.

“Since our last rate adjustment in April 2022, we have seen reduced sales from our GSL customer classes due to lower energy consumption, the loss of our largest customer, and significant inflationary pressures,” Ms Mullings said.

“We know there is no good time to propose a rate increase, but the requested adjustment is essential to maintain and improve the efficiency and reliability of our services and to allow us to invest in critical infrastructure maintenance, as outlined in our system resource plan, to enable the integration of renewable energy sources in keeping with the government targets.”

The Ministry of Grand Bahama said the GBPC’s proposed base rate increase is “unacceptable.”

“Whilst this decision claims to be ‘in alignment with its operating protocol and regulatory framework’, it is wholly ill-conceived, badly-timed, and appears to prioritise profit over the well-being of the community,” it said.

The ministry empathised with Grand Bahama residents and businesses, highlighting the additional strain the proposed increase would impose.

“In 2020, GBPC implemented a one per cent increase as a ‘Storm Recovery and Stabilisation Charge’ (SRS). In early 2022, the GBPA approved a 3.4 percent increase to the base rate, which was implemented in April 2022. Now, in 2024, amidst numerous power outages, GBPC seeks to impose a further 6.3 percent increase. This is not acceptable,” the ministry said.

The ministry also called on GBPC to improve its process for investigating and assessing claims of damage to household appliances and equipment resulting from frequent outages.

The ministry said: “We do not support the base rate increase and urge reconsideration based on the hardship faced by Grand Bahamians and the unreliable performance of the GBPC since the last increase.”

Kwasi Thompson, the FNM MP for East Grand Bahama, also described the proposed rate hike as a blow to Grand Bahama residents and called for government intervention.

“It is absurd to even consider another rate increase at this time,” he said.

Mr Thompson said residents, particularly in East Grand Bahama, have faced rising business license fees, customs fees, water prices, national insurance, boat license fees, aviation fees, passenger taxes, electricity costs, VAT on breadbasket items and medication, and air freight costs.

“The fishermen and farmers of East Grand Bahama have been calling for relief,” he said. “Unemployment in East Grand Bahama remains high. The government cannot allow another blow to the people of Grand Bahama and must stop this immediately.”