STATEMENT ON THE CLEAN ENERGY TRANSITION RIDER DECISION

 

May 17, 2024

 

The Fair Trading Commission (“the Commission”) remains committed to ensuring fair and transparent practices within the utility sector, safeguarding the interests of consumers while facilitating sustainable and efficient operations by service providers. It is with this dedication in mind that we address apparent misinformation in the public domain related to the Commission’s Decision on the Barbados Light & Power Company Limited’s (BLPC) Application for preapproval of investments and cost recovery through the Clean Energy Transition Rider (CETR) (“the Application”).

 

On May 6, 2024, the Commission issued its Decision on the Application. The Commission is a quasi-judicial body and relies on evidence in arriving at its decisions. Thus, in assessing utility rate applications, the burden of proof is on the utility which must substantiate its case with compelling evidence. After careful consideration and thorough review of the information submitted during the written hearing, the Commission determined that some of the proposed investments stated in the Application were not satisfactorily justified.

 

The Commission is cognisant that the implementation of Battery Energy Storage Systems (BESS) and other infrastructural upgrades in the grid ecosystem are a means of facilitating the full integration of variable renewable energy systems. The use of BESS is one potential approach which offers crucial ancillary grid service provisions to be exploited for operational efficiency, operational flexibility and interoperability benefits. The Commission has approved 15MW of BESS to be purchased in 2024 as requested by the BLPC in its Application. Additionally, the Commission has also approved the other assets intended to be deployed in 2024 to facilitate the integration, efficient utilisation, management and control of renewable energy systems in keeping with the objectives of the Barbados National Energy Policy (‘BNEP’) and the Integrated Resource and Resiliency Plan 2021 (‘IRRP’).

 

It was further determined by the Commission that the BLPC did not provide sufficient information to base an adequate assessment of some of the critical costs for other proposed investments. It is the position of the Commission that the BLPC has an obligation, as a prudent utility, to justify sufficiently, that all alternatives and costs were properly considered in arriving at the capacity of BESS proposed and the need for other resources requested in the Application. As an independent regulatory body, it is imperative that our decisions are guided by verifiable data and comprehensive evidence to ensure the integrity and fairness of the regulatory process. The Commission is required to balance the viability of the utility with the interest of rate payers, while facilitating the government’s policies.

 

As a regulatory body, the Commission takes the participation of intervenors seriously, recognising the valuable contributions they make to our decision-making process. It is essential for all parties involved to adhere to the established timelines and procedures to ensure a fair and efficient regulatory process. While we acknowledge the challenges that may arise during the course of interventions, timely communication and adherence to deadlines are crucial for maintaining the integrity and effectiveness of the regulatory framework. The Utilities Regulation (Procedural) Rules, under the Utilities Regulation Act, which governs any hearing proceeding before the Commission is readily available on the Commission’s website and intervenors are encouraged to become familiar with them. Notwithstanding this, there is some level of discretion that the Commission maintains however, failure to comply can hinder the ability of the Commission to make well informed and timely decisions in the best interest of all stakeholders. In its capacity as utility regulator the Commission is called to govern and govern it shall.

 

The Commission understands the significant investments needed to modernise and improve the utility infrastructure, especially in the context of advancing technologies and evolving consumer needs. The Commission remains committed to its mandate which includes the development of sustainable solutions that appropriately balances the interests of all relevant stakeholders.