Beginning March 2020, all Bahamas Power and Light (BPL) consumers will see their electricity bills increase by an estimated $27 per month, BPL confirmed in a notice published in yesterday’s Nassau Guardian.
“We would like to draw attention to and explain a change in this month’s BPL bill,” the notice states.
“When you review your bill, you will see a line labeled, ‘National Utility Investment Bond’ – a new fee and line item on everyone’s bill.
“With this new fee structure, all BPL customers, from major resorts to the average family, will see a small increase in their monthly bill starting in March. By our initial estimates, the average family will see their bill increasing by roughly $27 a month, and within the next year, most, if not all, of that cost will be offset by savings resulting from our new cheaper energy generation.
“This fee will allow BPL to service a bond that restructures about $321 million in debt while allowing us to invest in new and more efficient generation capacity.”
The notice, which is signed by BPL management, said the summer load shedding is a prime example of what happens when a company fails to maintain its equipment.
The notice called for understanding from its customers.
“We understand that no one wants to pay more for a service they need to rely on,” the notice adds.
“Our hope is that you understand that these steps are critical for BPL to turn the page on past practices that have been disastrous for our customers.”
The House of Assembly passed the Electricity Rate Reduction Bond Bill, 2019 last month.
The bill aims to establish a legislative framework for BPL to raise $650 million through a rate reduction bond.
According to Minister of Public Works Desmond Bannister, $321.1 million of the funds raised will be used to refinance BPL’s debt, $28 million for solar installations on the Family Islands, $15 million to convert Family Island generation facilities to liquefied natural gas, $15 million for fiberglass cooling pipe replacement, $30 million for an advanced metering infrastructure project and $6 million for system reinforcement and customer connections.
He also said that $48.1 million will be used for 132-kilovolt transmission and substation upgrades, $34.9 million for line upgrades and extensions, $24.7 million for other substation upgrades and $14.3 million for 34.5-kilovolt line upgrades.
BPL officials said the funds acquired as a result of the bond will be used to pay BPL’s debt, upgrade infrastructure and solarize the Family Islands, among other things.
Bannister has refused to reveal what BPL’s base rate increase will be, noting he could not say much because the government was in “a quiet period”.
During debate on the bill last month, Progressive Liberal Party (PLP) Leader Philip Brave Davis noted that “the bond [is] being securitized by the bills paid by customers and it would require an increase in the base rate”.