A new structure for electricity rates, announced last week by Belco, presents a roadblock to the island’s “clean energy future”, said the Bermuda Environmental Sustainability Taskforce.

Wayne Caines, the president of the power supplier, responded: “As renewable energy adoption continues to grow, Belco must deploy additional infrastructure to support the variable nature of distributed generation such as battery technology that supports frequency regulation.”

The change to the utility’s billing, approved by the Regulatory Authority to come into effect on August 1, differentiates between customers who generate power, typically from solar energy, and those solely consuming energy from the grid.

Belco called the move fairer and more transparent, enabling customers to see how their rates divide between the cost of generating, and transmitting and distributing the electricity they use.

However, BEST responded that the additional fixed costs stood to “significantly lengthen the payback period for solar installations”, which it said could render future projects “financially unattractive”.

The group added: “At a time when Bermuda should be accelerating its transition to renewable energy, these changes risk slowing or even reversing solar adoption across the island.”

BEST also said: “Under the revised structure, a homeowner with a small solar array exporting very little electricity may pay the same facilities charge as someone with a much larger installation exporting substantially more energy to the grid.”

That criticism was aired over the weekend by the company Sunny Side Solar, whose chief empowerment officer, Stuart Kriendler, said that the increased facilities charge affected all solar-generating customers “regardless of their impact on the grid”.

By contrast, Mr Caines has insisted the move did not amount to a penalty on solar power.

Mr Caines said the island’s increased levels of solar power imposed a cost on the electricity company to maintain the stability of the power grid, leaving customers without solar power covering the extra expense.

BEST issued a statement yesterday saying it was “deeply concerned” by the restructured charges.

The group agreed with the solar company’s assertion that “approximately 209 commercial demand customers consume around 40 per cent of Bermuda's electricity, yet reportedly pay comparatively lower facilities charges despite placing far greater demand on the electricity network”.

The environmental group highlighted solar energy’s capacity to reduce Bermuda's dependence on imported fossil fuels as well as cutting greenhouse gas emissions.

BEST pointed out that cash used to buy imported fuel was money that left the island’s economy.

It said: “While Belco provides an essential public service, its parent company is foreign-owned, meaning a portion of the financial returns generated by the electricity system ultimately leaves the island.

“A stronger local renewable energy sector keeps more economic value, employment and investment within Bermuda.”

The group added: “By making rooftop solar less economically viable, the new rate structure risks locking Bermuda into continued dependence on imported fossil fuels for decades to come.”

BEST added that a decline in demand for rooftop solar declines would threaten “high-quality local jobs and technical expertise that Bermuda can ill afford to lose”.

It called on the RA and Belco to revisit the proposed charges and “undertake a transparent public review of its impact on Bermuda's clean energy goals, local employment and long-term energy security”.

Mr Caines responded: “The facilities charge is a component of electricity rates that refers to the fixed fee that covers the infrastructure costs of transporting electricity to and from customers.

“Belco continues to support the adoption of renewable energy on the island.

“However, its obligation is to meet the needs of all customers with a safe, secure and reliable electricity system.”

Mr Caines said that, on top of having to spend money on maintaining the grid as renewable energy increased, the company had to “look at the system as a whole, ensuring that it carries enough standby capacity to meet distributed generation customers’ full demand the moment their systems are not generating, at night or on a cloudy day”.

He added: “That capacity has to be built and maintained whether customers export a lot of energy, very little or nothing at all.

“The rate structure was directed and approved by the Regulatory Authority following a cost-of-service study, independent expert advice, technical modelling and public consultation. Full breakdowns for every customer class are published at belco.bm.

“If fairness is the standard, it must apply across the sector.

“Solar providers should be regulated to the same technical standards, oversight and limits that Belco operates under, so that the costs and risks of an unregulated segment do not fall back on to customers.”