By FAY SIMMONS

Tribune Business Reporter

jsimmons@tribunemedia.net

The Opposition’s leader yesterday said he will seek to meet with Grand Bahama Power Company’s Canadian owner after its executives declined to meet over the proposed 6.3 percent base rate increase.

Michael Pintard, speaking at a Free National Movement (FNM) press conference, said Grand Bahama’s electricity supplier had replied they are “not prepared to meet at this time” to discuss its 2024-2027 tariff proposal which has yet to be approved by the Grand Bahama Port Authority (GBPA) as regulator.

As a result, the FNM leader said he will now seek to meet with Canadian energy giant, Emera, which is GB Power’s 100 percent owner and ultimate parent company. And he promised to prepare a “substantial amount” of Grand Bahama residents, from both political sides, to meet with the Utilities Regulation and Competition Authority (URCA) and the GBPA amid the ongoing dispute over who regulates GB Power.

“We reached out to the power company seeking a meeting, and if I remember correctly, just yesterday, they indicated they are not prepared to meet at this time,” said Mr Pintard.

“We’ve given them an opportunity. We will now speak to their parent company. And then we’ll take Grand Bahamians of all political stripes, not just to them, but to URCA, to the GBPA, all of those who represent themselves as the regulator. We’ll go and have a conversation with them, and we’ll do so with a substantial amount of residents from Freeport and Grand Bahama.”

Mr Pintard maintained that the Free National Movement (FNM) does not support the proposed base rate increase and has made that clear since it was initially requested. However, Dave McGregor, GB Power’s president, previously told Tribune Business that three-quarters of customers will actually see a decline in their overall light bill despite the 6.3 percent base rate rise.

This, he asserted, is achievable because reductions in the fuel charge component of electricity bills will “offset” the proposed base rate hike for most should the proposal be approved. However, few residents and businesses trust this scenario will actually materialise.

Explaining the rationale for the increase, which was submitted to the GBPA on August 1, 2024, in accordance with GB Power’s regulatory obligations, Mr McGregor said the extra revenues generated by the rate hike will help to finance a 67 percent jump in GB Power’s annual capital investments to $20m per year between 2025-2027.

The extra investment, Mr McGregor told this newspaper, would facilitate the increased integration of renewable energy into GB Power’s grid through the deployment of a batter energy storage system (BESS) that is expected to be installed and operational by 2026.

Asserting that the utility has “tightened the belt as best we can”, he said this had enabled it to apply for a base rate increase one full percentage below the 7.3 percent inflation suffered by The Bahamas over the past three years covered by its present tariff structure.

Disclosing that GB Power had lost 5 percent of its total demand in January 2024 with the closure of PharmaChem Technologies pharmaceutical plant, while the total electricity load consumed by the island’s major industrial customers has “under-performed”, Mr McGregor also voiced optimism that the utility is “out of the woods” after resolving the outages that plagued early summer.

However, GB Power’s rate application has renewed the battle over whether URCA or the GBPA is the utility’s regulator. And it has further intensified the ongoing conflict between the Government and the GBPA over the former’s demand that the latter pay it $357m to compensate for expenditure incurred in Freeport, over and above the city’s tax revenues, between 2018 and 2022.

GB Power’s challenge to URCA’s regulatory authority in Freeport still remains before the Supreme Court after some eight years.

GB Power initially sought an injunction to prevent URCA “from regulating, or seeking to exercise licensing and regulatory authority” over it. GB Power’s action is founded on the basis that, as a GBPA licensee, it is licensed and regulated by the latter via the Hawksbill Creek Agreement - and not by URCA and the Electricity Act 2015.

It is arguing that the previous Electricity Act’s sections 44-46, which gave URCA the legal right to licence and oversee energy providers, “are inconsistent, and conflict with, the rights and privileges vested in [GB Power] and the Port Authority” by the Hawksbill Creek Agreement.

GB Power’s statement of claim argues that itself and the GBPA “have been vested with the sole authority to operate utilities”, including electricity generation and transmission and distribution, within the Port area until the Hawksbill Creek’s expiration in 2054. Cable Bahamas, too, also has a separate legal action contesting URCA’s jurisdiction and authority to regulate its Freeport subsidiary.

However, the new Electricity Act 2024, which treats Grand Bahama as a Family Island, makes the Grand Bahama Power Company the “approving authority” for anyone submitting a proposal to supply electricity to the public on the island.

The Act states that any approvals by such an “authority” must also be given the go-ahead by URCA, and this has been interpreted as a neat way of circumventing the GBPA’s utilities regulatory authority in Freeport and transferring it to URCA via GB Power Company. Thus the stage for a major regulatory and legal clash has been set.

Mr Pintard has argued that GB Power should not consider a rate increase while residents face “inconsistent” electricity supply and damage to appliances from power surges. He has urged the utility to be more responsive to these issues, and also called for it to disclose how much was collected from the surcharge implemented after Hurricane Dorian and how much was recovered from insurance for storm damages.

He has also criticised URCA for not being a “robust and strong” regulator, and emphasised the need for a stronger independent body that cannot be swayed by the Government.