Prime Minister Dr. Hubert Minnis promised on Friday that the government will bring energy costs down for all residents and businesses in The Bahamas, though he declined to give a specific date.
However, he said an announcement regarding lower energy costs would be made “next year”.
“I understand that we must do everything that we can to reduce energy costs not just for your sector, but for all residents and businesses in The Bahamas,” said Minnis at the Bahamas Hotel & Tourism Association Annual Meeting at the Atlantis Resort on Paradise Island.
“This is a major priority, and various announcements toward this end will be made next year. We will bring energy costs down.”
Lowering the cost of energy was something the Minnis administration promised as a high priority item coming into office, but the scrutiny on delivering that has intensified as Bahamas Power and Light (BPL) bills have increased due to, for the most part, rising oil prices.
On the sidelines of the event, Minnis spoke with media about plans to move toward more sustainable forms of energy, such as solar, while at the same time striking a balance to not financially cripple the already financially ailing state power provider.
“I think we have to move towards green energy,” he said.
“Energy cost is very high. Even with our new subdivisions, we’re going to insist that they be would getting everything duty free.
“So, we’ll insist that they have at least a minimum amount of solar panels that would take certain segments away from their billing sectors, especially the heaters.
“We think that would be a great plus moving forward.
“Businesses, I don’t see why they should not be encouraged to move towards green energy if we want to do our part in terms of carbon emissions.
“Now, obviously, there would be the concern, ‘Oh, you’re taking so much revenue away from the power station’.
“But let’s be efficient. Let’s be efficient. If we’re efficient, then that may not have the great impact that you expect.
“And there are other formulas that can be utilized.
“You can have what you call base or minimal fees.
“So, individuals might come off [the grid] and they might come off only 30 percent.
“And even if they come off 100 percent or near 100, then there should be a base fee that they would pay to the power station to ensure the stability for everyone.
“But I think we need to push towards that, especially the Family Islands.
“We cannot, it’s not cost effective to, run transmission lines 10, 12 miles to one home when we solarize and can cut our costs by as high as 90 percent.
“But we will bring it down.”
The average residential light bill in The Bahamas increased by 45 percent between October 2017 and October 2018, according to data provided by BPL.
The government raised the rate of value-added tax (VAT) from 7.5 percent to 12 percent, including on BPL bills, in July.
To offset some of the impact on BPL customers, the government had announced that electricity bills $100 or lower would be exempt from VAT, but later increased the ceiling to $200 after public outcry.
The government last week raised the ceiling again to $300.
Minister of Public Works Desmond Bannister said that the removal of VAT on electricity bills $200 and lower helped 52,364 customers in October.
Bannister added that a total of 64,085 BPL customers stand to benefit from the exemption increase to $300.