By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

An ex-Cabinet minister has blasted it is “total hogwash” for the Government to boast it has reduced business energy costs with his firm now paying an all-in rate 45.8 percent higher than in October 2022.

Dionisio D’Aguilar, Superwash’s principal, told Tribune Business the latter date is his “starting point” for comparing Bahamas Power & Light’s (BPL) electricity costs given that it is when the utility’s hedge ended to be overtaken by its so-called ‘glide path’ strategy for recouping under-recovered fuel costs.

Analysing the historical data, he asserted that BPL’s all-in per kilowatt hour (KWh) prices have “progressively gotten worse” over the past 18 months, having risen from 32 cents and 31 cents per KWh at year-end 2023 and early 2024, respectively, to the present 35 cents per KWh.

The former minister of tourism and aviation, noting that BPL bills for businesses and households are calculated differently under the Government’s equity rate adjustment structure, nevertheless told this newspaper that Superwash’s present 35 cents per KWh rate is some 11 cents or almost 46 percent higher than the 24 cents the laundromat chain was paying when the fuel hedge ended.

Speaking in the wake of last week’s outcry over the huge month-on-month increase in consumer, with some homeowners suffering a near-tripling in their July bill, Mr D’Aguilar said: “What I noticed is that I am now paying 35 cents per KWh. My starting point is when the hedge came off in 2022, which was 24 cents per KWh.

“We’re in that season, so I am going to get slightly political. The Government always likes to boast they are saving the Bahamian people and Bahamian companies some money. Notwithstanding that, the price of electricity has never been back to 24 cents per KWh since the hedge came off, and right now I am paying 35 cents per KWh, which is 46 percent more.

“For the month of May, we paid 35 cents per KWh. In April we paid 35 cents per KWh, and for January, February and March this year, it was 34 cents per KWh. Last year, 2024, it started off at 31 cents per KWh and ended up at 33 cents per KWh,” he continued.

“We’ve progressively gotten worse. So for this year we’ve trended up. We’re currently at 35 cents a KWh, at the beginning of the year we were at 34 cents per KWh, and last year January started at 31 cents per KWh. The Government talks endlessly about what they are saving business consumers on their electricity bill, but it’s all hogwash; total hogwash. 

“Since that hedge came off we’ve been paying significantly higher light bills. That talk about this, talk about that, this twist and turn and that twist and turn, but it’s all a smokescreen. In 2023 [during BPL’s glide path], it started at 32 cents and went up to 41 cents, then came back down to 42 cents.”

Mr D’Aguilar argued that BPL’s all-in costs, and fuel charge, “never moved a dollar” for two years between October 2020 and October 2022 after the former Minnis administration ‘hedged’ the state-owned utility’s fuel costs during the height of the COVID-19 pandemic. It exploited the drop in global oil prices, due to low demand, to lock-in favourable prices for BPL’s fuel purchases.

The former Cabinet minister argued that despite the Davis administration “coming with all the stories, left and right, fixing this and fixing that, and buying this and buying that”, BPL’s all-in costs and fuel charge have yet to fall back to the 24 cents per KWh achieved by the hedge.

“It’s been an unmitigated disaster for businesses,” Mr D’Aguilar told Tribune Business. “It’s caused our electricity bills to go up significantly. I am always going to hold them to that 24 cents per KWh with the hedge. That’s my basis for comparison. That’s the only way they will convince me that what they’re doing is better.

“They bamboozle us, paint all these words, throw up all these smokescreens.” To ease the burden of BPL’s sudden bill increases, the Government last week unveiled a Summer Rebate initiative that provides a 5-6 percent discount on the utility’s fuel charge, but Mr D’Aguilar said Bahamians will still end up paying for this as taxpayers instead of electricity consumers.

BPL itself confirmed that the rebate will be subsidised, or underwritten, by taxpayers through the Government, which Mr D’Aguilar said likened to “taking from one pocket, putting in another and screaming from the hill-tops that you’ve created some savings”.

He added: “You’ve just got to look at the numbers. The numbers tell the story. What this government is famous for doing is saying we’re trying to hold the price, not let it go up. But, when the oil prices come down, they don’t go come down.

“Clearly, if oil prices have come down 20 percent [since the start of 2025], and BPL’s prices have not budged, they are clearly trying to cover operational costs and debt and the fuel charge is not solely covering the fuel costs. We are at their whim, however they determine to do it. Your light bill today is significantly higher than when the hedge was there. Their policy has not been successful.”

Both the Government and BPL were last week somewhat vague with their explanation for why consumer bills suddenly jumped by by between 38.6 percent to almost tripling via a 199 percent increase month-over-month for July. Various reasons were cited, including the impact of the Israel-Iran conflict on global oil prices; increased summer demand and AC use; and BPL relying on more expensive diesel fuel.

BPL said its fuel costs had risen from around 16 cents and 20 cents per kilowatt hour (KWh), for the portions of customer bills below and above 800 KWh respectively, to 18.996 cents and 22.196 cents in June. But research by Tribune Business revealed that global oil prices, as measured by the Brent crude index, have declined by 20.52 percent year-to-date to stand at $67.678 per barrel.

Oil prices are thus moving in the opposite direction to BPL’s fuel costs with no real reason given for the disconnect. However, a totally different explanation to that given by both the Government and BPL was yesterday posted on a website known to be connected to Fred Mitchell, minister of foreign affairs.

While difficult to translate, it seemed to suggest that BPL had incorrectly calculated consumer bills from a previous month and is now trying to reclaim what should have been charged then in the July billings. The hiked bills went out despite opposition and demands at the Davis administration’s policymaker level that they not be issued.

Laying out what it branded “a foul-up” by BPL, the website said: “They made a mistake in seeking to recover monies that were owed them as a result of a billing error made by them all in one chunk.  The result was that the reductions that families saw in their bills the month before seemed to be eaten away by the new charges for the current month.

“Some bills went out before the Government discovered the error. BPL’s management had been advised not to do so. They ignored it. They were instructed to reverse it, so that all those persons who got the higher bills should have a rebate coming to them.” That, though, remains to be seen.  

The Summer Energy Rebate will lower BPL’s fuel charge by 1.1 cents per kilowatt hour (KWh) for both portions of the bill - under and over 800 KWh. The fuel charge below 800 KWh will be lowered from the 18.5 cents that appeared in Bahamians’ July bills to 17.4 cents, representing a 6 percent discount, while for over 800 KWh it is being lowered from 22.5 cents to 21.4 cents.

The move came after social media lit up in outrage as consumers received their bills due for payment in July. Almost all questioned the sharp month-over-month increases, with posts seen by Tribune Business showing all-in cost increases ranging from 38.6 percent to almost tripling via a 199 percent jump.

Tribune Business, which has also seen its own bill double, calculated that the 1.1 cent per KWh reduction on the portion of its fuel charge above 800 KWh would have saved around $36.70 on its July bill, while the savings on the portion below 800 kilowatts would have been $8.70. This translates into just a $45.40 collective saving.

The Government’s latest quarterly debt report, covering the three months to end-March 2025, shows it has yet to repay much of the loan it received from the Government - thought to be around $110m - to help cover the arrears owed to Shell under the former ‘glide path’ initiative. Some $170.3m was shown to be owing as at end-March 2025.