Cabinet has “not even considered” any BPL rate increase, says Sears
Rate reduction bond reportedly not approved
NASSAU, BAHAMAS — Prime Minister Philip Brave Davis said yesterday that his government will do “all in its power” to avoid raising the cost of electricity for Bahamians.
Davis, who is attending the 33rd CARICOM Intersessional meeting in Belize, said his administration will do its “endeavor best” to mitigate the impact the significant rise in global oil prices resulting from the Russia-Ukraine conflict will have on Bahamians.
“Lord knows that our people can least afford to have more taxes or costs visited upon their backs. My government will do all in its power to see how we can avert raising the cost of electricity on our people,” Davis said.
He said that once he returns from the CARICOM meeting, which ends today, the government will “brainstorm” on how best to handle the issue.
Davis was addressing a proposed electricity rate increase, which Works Minister Alfred Sears said yesterday had not been given Cabinet approval and was ultimately rescinded on Monday, hours after the announcement of the increase was made.
Speaking on the announcement yesterday, Sears told reporters: “The Cabinet has not considered increasing the cost or rate of electricity in The Bahamas, and therefore it is premature.
“The prime minister has appointed a Cabinet subcommittee which is looking at how to address the question of energy on a short as well as long-term basis.
“The government and the subcommittee have met with a number of entities, both national and international, relating to the supply of LNG (liquefied natural gas), solar energy and the development of microgrids within the entire in The Bahamas so that we can bring down the cost of electricity, have a more sustainable supply and also ensure that there is ownership in the infrastructure for the provision of electricity.
“At this point, no decision has been made.
“In fact, Cabinet has made no decision.
“As a matter of fact, the Cabinet has not even considered any proposal to increase the rate of electricity.”
Sears added: “Specific to the statement issued by BPL (Bahamas Power and Light) with respect to the increase of the rate for electricity, the matter was raised with me by the chairman last week and I spoke very briefly with the prime minister.
“The Cabinet has not had an opportunity as the shareholder of BPL and also as the backstop supplier because the hedge which stabilizes the price of electricity, that is provided by the government.
“The people of The Bahamas are really funding the subsidization of electricity in The Bahamas and the matter has not been brought to Cabinet at this time, and therefore the release was premature.
“When it came to my attention as the responsible minister, I spoke with the chairman and that statement was recalled.
“At this point, the status quo is just that; it’s still as it was prior to the issuance of the statement.
“I had a conversation with the chairman and it was revoked within the matter of an hour.”
Rate reduction bond
At this point, we have not proceeded with the RRB that we met.
– Alfred Sears
According to Sears, Davis has decided not to proceed with the rate reduction bond (RRB) that was left in place by the Minnis administration.
“Rate reduction bond was a proposal we met. At this point, we have not proceeded with the RRB that we met,” said Sears.
“The purpose of the Cabinet subcommittee is to look at all of the available options, to consult with our domestic stakeholders and to take the proposal back to the Cabinet and help the Cabinet make a determination.”
Sears previously revealed that the Minnis administration did not give BPL the green light to proceed with its RRB, which was part of the utility provider’s efforts to obtain the financing needed to refinance the company’s legacy debt and also fund major upgrades to its transmission and distribution network.
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