NASSAU, BAHAMAS- The Bahamas’ National Energy Policy 2025–2030 is targeting a cleaner energy future as renewable sources currently account for just 2.5 percent of the country’s electricity capacity, while fossil fuels remain dominant.
The country’s energy landscape is heavily reliant on imported fossil fuels, which exposes electricity rates and supply to global market volatility. As of December 2023, The Bahamas had 735 megawatts (MW) of installed generation capacity, almost entirely derived from liquid distillates of crude oil, including automotive diesel.
According to the NEP document, Bahamas Power and Light (BPL), which serves roughly 115,000 electricity accounts across the country, accounts for approximately 84 percent of the nation’s electricity customers. Residential users make up about 85 percent of BPL’s customer base, while commercial and industrial users account for the remaining 15 percent. In Grand Bahama, the Grand Bahama Power Company (GBPC) manages around 20,000 accounts, 80 percent of which are residential. Overall, the nation’s 135,000 active electricity accounts represent approximately 40 percent of the population. Annually, Bahamians consume about two billion kilowatt-hours (kWh) of electricity, with BPL customers accounting for 86 percent of total consumption and residential users consuming 46 percent of that volume. Peak demand across the islands reached 415,000 kW in 2024, underscoring the importance of reliable power infrastructure for economic activity and daily life.
Despite relatively low base rates—BPL averages US$0.09 per kWh—fuel costs elevate overall tariffs to US$0.34 per kWh, comparable to the regional average of US$0.35 per kWh. Grand Bahama’s rates are slightly higher, with residential tariffs averaging US$0.38 per kWh and base rates of US$0.27 per kWh. These costs illustrate the challenges faced by a system largely dependent on imported fossil fuels, even as the country maintains one of the lowest base rates in the Caribbean.
Renewable energy deployment in The Bahamas remains modest but is steadily growing. Solar photovoltaic (PV) installations, facilitated under the Electricity Act of 2015, now contribute roughly 2.5 percent of total installed generation capacity. Privately installed PV systems total approximately 12,000 kW, with 80 percent located in commercial settings and the remaining 20 percent in residential homes. While 75 percent of total PV systems are residential, 90 percent of these installations are concentrated on New Providence, highlighting a clear need for distributed renewable energy development across the Family Islands. Utility-scale solar projects add roughly 14,000 kW of generation capacity, complemented by Battery Energy Storage Systems (BESS) with a combined installed capacity of 47,300 kWh, primarily deployed by licensed electricity providers to enhance grid stability and support intermittent renewable generation.
The National Energy Policy 2025–2030 aims to address these challenges by promoting cleaner energy sources, improving energy efficiency, and ensuring reliable access to electricity across all islands. The policy builds upon the previous 2013–2033 framework, adjusting for recent legal, regulatory, economic, environmental, and social developments. Its objectives include expanding renewable energy generation, particularly solar, wind, and biomass; diversifying the energy mix through the introduction of natural gas; modernizing electricity infrastructure; and promoting energy efficiency across residential, commercial, and industrial sectors.
The shift toward natural gas represents a central component of the policy, offering a cleaner and more cost-effective alternative to heavy and light fuel oils. Commercial availability of natural gas in 2025 is expected to lower power generation costs while reducing the country’s environmental footprint. Concurrently, NEP 2025–2030 outlines strategies for smart grid implementation, grid modernization, and disaster-resilient infrastructure, critical for a nation vulnerable to extreme weather events and climate change.
Energy efficiency is another cornerstone of the policy, with initiatives such as time-of-use tariffs, demand response programs, and tiered pricing structures designed to reduce peak demand and overall consumption. Consumers are encouraged to adopt energy-efficient appliances and building codes, supported by public education campaigns and technical assistance programs. These measures aim to optimize demand-side management and lower electricity costs for households and businesses.
The policy also emphasizes renewable energy workforce development and the creation of economic opportunities linked to clean energy. Training programs are planned to upskill workers in solar panel installation, wind turbine maintenance, and energy efficiency services. Investment incentives, including tax credits and green investment funds, are designed to promote both utility-scale and small-scale renewable projects while stimulating local manufacturing and service sectors connected to energy infrastructure.
LNG infrastructure is another key focus, with the government planning import terminals and distribution networks across major islands. These developments will support national energy security, reduce reliance on imported oil, and enable lower-cost electricity production. Private sector engagement will be encouraged to accelerate investment and enhance competition in the energy market, further stabilizing prices and broadening access to modern energy services.
