Lower solar excess power rate next year

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  • Solar issue: the Regulatory Authority will be tasked with finding a fair rate for Belco to pay solar producers for their excess power

    Solar issue: the Regulatory Authority will be tasked with finding a fair rate for Belco to pay solar producers for their excess power


A new lower rate for energy bought from solar power users will take effect from the start of next year.

The new feed-in tariff of 17.36 cents per kilowatt hour — about half the previous rate — will start next January.

But Grant Gibbons, Minister for Economic Development, said that when the Regulatory Authority takes over policing of energy from the Energy Commission in the near future, it will make drawing up a new policy governing solar power a matter of priority.

Dr Gibbons was speaking after the Energy Commission reported on power firm Belco’s proposed termination of its net metering scheme, which compensated solar power producers who fed excess energy into its grid.

He said: “The regulation of electricity and the setting of rates in particular is a delicate balance of many factors.

“We all want to see more renewable used in Bermuda, but we also have a duty to understand any inherent subsidies and ensure that renewable energy comes at a price we can all afford.

“The Energy Commission’s report highlights that complexity and demonstrates the necessity for the new regulatory regime.

“I have every confidence that the Regulatory Authority will meet this new challenge with the same due diligence and professionalism they’ve exhibited in regulating the electronic communication sector.”

When Belco applied for a rate change to residential net metering and commercial renewable energy in August, it argued that the previous rate was too high and effectively meant average customers subsidised wealthier ones because it did not take account of Belco’s fixed costs like distribution and transmission.

The incentive, introduced in 2010, was set for 200 customers, but a total of 325 eventually signed up for the scheme.

The scheme allowed residential customers to send excess power to the Belco grid at the full retail rate.

The scheme’s existing members will continue to receive the higher rate, but newcomers will get the new, lower “avoided cost” rate.

The Energy Commission report also recommended that, until the Regulatory Authority conducts a thorough examination of the solar energy market and economics, Belco should “fully absorb the cost of purchasing that power and allocate it to a recovery account similar to the Commission’s ruling in a recent rate case filing directive”.

The report added that Government should also look at establishing a policy on the importation and use of technology used to store power.

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Published Oct 27, 2016 at 8:00 am (Updated Oct 27, 2016 at 12:51 am)

Lower solar excess power rate next year

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