By Fay Simmons

Tribune Business Reporter

jsimmons@tribunemedia.net

BPL CEO Toni Seymour said the price of electricity will stabilise once LNG comes on stream next year.

Speaking to Tribune Business, Ms Seymour said with the cost of oil and diesel fluctuating due to geopolitical pressures the transition away from diesel to LNG next year will bring stability to the utility’s fuel pricing.

“With the threat of war in the Middle East, the oil prices will still continue to fluctuate. Our cost of fuel is based on global trends, but it’s also based on our consumption and how much we use. As we transition into LNG later on this year and early into next year, then we can see some more stability in terms of our fuel pricing,” said Ms Seymour.

She explained that the recent spike in electricity bills was due to the company deploying more diesel engines to sustain the increased summer load. Although the engines that run on cheaper heavy fuel oil (HFO) are still in use more diesel engines have been added to the energy mix which increased the fuel surcharge.

“Our Clifton pair power station runs on heavy fuel oil, which is the cheaper of the two fuels that we use. But in the summer months, once the load starts to increase, we have to run more engines, which means we’re running more diesel engines. We’re still running our HFO engines, but in addition to that, we’re running more diesel engines,” said Ms Seymour.

“While we’ve installed some high efficiency diesel turbines, the cost of diesel is higher than the cost of heavy fuel oil, which means that the more fuel we burn, the more the fuel surcharge will be that we pass on to the customers, so that is the reason for the increased bills that our customers saw last month.”

She said BPL’s summer energy rebate programme will allow consumers to better manage their consumption and provide relief during the peak season.

The government has decided to do is hold the fuel surcharge steady for the remainder of the summer until the end of September, and then kind of subsidise BPL on the back end, just to bring some relief to our customers during the hotter months, because consumption goes up in the summer, because it is hotter and we burn more fuel in the summer.

That will give customers the benefit of knowing ahead of time what the fuel charge will be, and they can plan for that and then work on managing consumption or lowering consumption, so that they can see lower bills

Beginning with the July billing cycle, residential consumers will benefit from reduced fuel charge rates of 17.4 cents and 21.4 cents per kilowatt hour, down from the current rates of 18.5 cents and 22.5 cents, respectively.

Officials said the rebate is intended to help offset higher electricity costs driven by increased summer demand and a temporary reliance on diesel, a more expensive fuel, to maintain stable power supply.