BSEA turns up heat in solar power row
Sparks flew yesterday as solar energy suppliers hit back at power firm Belco over an agreement to buy back excess power generated by the sun.
A spokesman for the Bermuda Sustainable Energy Association (BSEA) dismissed claims by Belco that the industry had failed to respond to a draft agreement on buying power from commercial solar users.
But the BSEA spokesman said the draft agreement given out for comment by the industry did not include rates for the purchase of excess solar energy.
Arrangements currently exist to buy back power generated from domestic renewable energy users — but no agreement is in place for large-scale commercial users.
The spokesman said: “Without these numbers it is virtually impossible to justify the sale of commercial solar systems for the simple reason that an accurate return on investment cannot be calculated to support the business case for the purchase.
“This is precisely why there has been such intransigence in the uptake of commercial solar projects thus far.
“In contrast, the residential solar market has seen an exponential growth over the last three years thanks to the existence of a defined interconnection and power purchase agreement allowing homeowners and installers to perform the necessary financial due diligence to justify the purchase of the system.”
The spokesman added: “For Belco to suggest that they have not received a response from BSEA is misleading at best.
“They are fully aware that we are awaiting a discussion on the financial details of their proposed commercial power purchase agreement.
“To expect BSEA to evaluate a proposed agreement without including the key financial data is obviously quite unrealistic.
“We continue to look forward to having a draft document that includes the necessary financial information that will allow meaningful discussion on this most important topic to commence.”
And he said: “The financial justification for any commercial investment into solar power is entirely contingent on being able to generate a satisfactory return on investment over the projected lifespan of the system, which is typically a minimum of 25 years.”
A war of words broke out this week after it was revealed that major solar power uses like homewares store Gorham's and other companies were already supplying excess power to Belco — but not getting any credit on their conventionally-generated power bills.
Belco told The Royal Gazette earlier this week that the draft agreement had been sent to the Energy Commission, which comes under the Ministry for Economic Development, in May and that the firm was awaiting its decision.
Economic Development Minister Grant Gibbons said: “The Ministry recognises the importance of developing fair and equitable interconnection agreements as a basis for the further expansion of solar and other alternative energy production in Bermuda.”
Dr Gibbons said more than 130 residential solar power uses were already hooked up to the BELCO grid.
He added: “We would like to see these numbers continue to increase. We would also like to expand independent power production to include larger, commercial installations. To achieve this we need robust interconnection agreements to make this work for everyone.”
But he said any agreement would have to look at the technical requirements and safety as well as price.
Dr Gibbons added: “The process is complex and it must be done correctly to avoid risk to the entire grid, or inequitable subsidies.”