Average monthly electricity bills are expected to drop by about $20 in the new year after a reduction in base rates, Belco announced yesterday.

The change, which follows an approvals process by the Regulatory Authority, will take effect for all meter readings taken on or after January 1.

Belco added that the fuel adjustment rate, which is set quarterly, will remain at 13.799 cents per kilowatt-hour in the first quarter of 2026.

The company explained: “For a low-usage residential household whose consumption is 200kWh per meter reading cycle, there will be a decrease of approximately $5.74 to a monthly bill [after the prompt-pay discount].

“For the average residential household whose consumption is 650kWh per meter reading cycle, there will be a decrease of approximately $20.80 to a monthly bill [after discount].

“For a high-usage residential household whose consumption is 1,500kWh per meter reading cycle, there will be a decrease of approximately $68.54 to a monthly bill [after discount].”

Wayne Caines, the president of Belco, added: “Over the past year, we have undertaken a comprehensive review of our operations at Belco to identify opportunities for greater efficiency and cost savings that benefit our customers.

“These efforts have enabled us to achieve operational improvements that are being passed on to our customers through lower base electricity rates which will be seen on your bills in January.

“Belco remains committed to continually assessing its operations and associated costs, while ensuring that we reliably meet the energy demands of our customers.”

The power company confirmed last month that voluntary separation packages were offered to staff as it sought to reduce operational costs.

Mr Caines said then: “Like many utilities in similar jurisdictions, Belco is adapting its business model to better serve customers and provide the most cost-effective electricity service while ensuring reliability and building for a sustainable future.

“In response to evolving stakeholder expectations, we have conducted a comprehensive assessment of our operations.

“This review has examined our organisational structure, operating models and processes to identify opportunities for greater efficiency and to reduce our operating expenses.”

A spokesman for the Regulatory Authority of Bermuda, which oversees the island’s electricity sector, said today that the organisation’s 2026-27 retail tariff review was complete.

He confirmed that electricity rates will fall for all customer classes from January 1.

The spokesman said: “Base rates will fall by 10.5 per cent, with the average overall retail rate decreasing by approximately 7.6 per cent.

“Following an established regulatory methodology, the RA approved an allowed revenue of roughly $237 million for 2026, which is approximately $17 million lower than Belco’s request.

“This outcome reflects updated cost information, efficiency assessments and higher-than-forecast electricity sales, all evaluated through the RA's standard analytical framework.

“An entrenched and thorough methodological process is utilised each year by the RA to ensure that Belco’s allowed revenue reflects the efficient and transparent cost of providing service.

“The 2026 review follows this approach, resulting in a determination grounded in data, rigorous analysis and the RA's commitment to fairness and accountability.”

A government spokeswoman said: “The Ministry of Home Affairs welcomed Belco’s announcement that base electricity rates will be reduced for all meters read on or after January 1, 2026.

“This means households can look forward to monthly savings ranging from roughly $5.74 to almost $70 on their electricity bills.”

Alexa Lightbourne, the Minister of Home Affairs, said: “Families are under real pressure from cost-of-living increases.

“Any reduction in cost of an essential service like electricity is significant and the RA’s decision will provide meaningful relief for households across the island.”

The spokeswoman highlighted how the rate cut aligns with the Affordable Bermuda Basket initiative, which offers discounts on everyday grocery items, and the Government’s wider affordability drive.

Ms Lightbourne added: “The Affordable Bermuda Agenda is about aligning government policy, regulators and industry partners around one clear goal, lowering the everyday cost burdens for Bermudians.

“We will continue to work with all our community partners to ensure critical services remain fair, transparent and affordable.”

• For more information, visit the RA website atra.bm, the Belco website atbelco.bmandcostofliving.gov.bm.

UPDATE: this article has been amended to include comment from the Ministry of Home Affairs