Dr Gibbons Speaks At Bermuda Energy Summit

Good morning, invited guests, panelists, moderators, political colleagues and Mr. Ted Kury, our Summit chairman. I’d like to welcome each of you and thank you for taking time out of your busy schedules to participate in the Bermuda Energy Summit 2014.

As most of you may be aware, energy is a complex issue. It’s an issue that resonates with all of us -whether because we chafe at paying an ever-increasing electricity bill, or whether we are responsible for preparing budgets, in which energy costs can be a volatile and unpredictable line item.

Apart from the economics of energy, we must also be concerned with our role in climate change.

I think we all recognize that the actions of sixty-five thousand people will not melt our polar ice caps, but what should be guiding us, is the principle that – what is right for us as Bermudians, is right for us as global citizens.

Rather than relying on catch phrases or simplistic goals, we should instead, focus on the concept of ‘sustainability’.

When we speak of ‘sustainability’, we should do so in the widest possible terms, that is; the sustainability of our environment, the sustainability of our people, and the sustainability of our economy.

We must manage each of these elements of Bermuda’s ecosystem to ensure that as each evolves, we maintain the appropriate balance between them.

Therefore, from an energy perspective, our first task should be to determine what energy sources and what mix of those sources are best for Bermuda.

Belco’s Integrated Resource Plan could well form part of the Bermuda Energy Plan, but input from all the other stakeholders represented here today, plus the wider community will also be sought. The path forward is not as much a ‘national transition’ as the 2011 White Paper is subtitled, but is more of a national transformation.

We must re-frame the way we think about energy, the way we use energy, the way we purchase energy, and the way we source it.

To start that transformation, we need to begin the dialogue.

This Summit, in bringing together a wide range of stakeholders, is the start of that dialogue and the beginning of that transformation.

We will not be arriving at final decisions today, but will instead discuss the tasks ahead so we can understand what questions need to be asked and what conversations need to continue. This Summit is not about natural gas, or the environment, or the economy, but it’s about what’s best for Bermuda.

Energy reform needs to undergird our economic recovery, and if we get it right, it could even accelerate the pace of that recovery.

Today, we will be discussing energy production, and examining the possibilities of what options are available to us.

One thing is clear – we cannot continue to produce electricity exclusively from oil. There is too much risk, not just in terms of the volatility of pricing, but also in terms of the environment.

So we will examine other alternatives, but what we hope to be able to demonstrate today is the need for a diversified energy portfolio, in which each technology supports the other.

To diversify that portfolio, we have to ensure that not only are the technologies robust, proven, and economically viable, but also that the rules of engagement are equal to the task.

The success of regulatory and legislative reform will be wholly dependent on the policies that frame it. We need to ensure that Bermuda’s best interests are protected, that we encourage an energy sector that keeps pricing transparent and affordable, and one that creates jobs for Bermudians.

We need an energy sector where all participants are treated fairly, including the incumbent, the independent power producers and customers.

New power producers must be assured that they can enter and compete in the energy market, and that they are being charged appropriate fees for any shared infrastructure.

Customers must be assured that pricing is fair and reflects the level of service that they expect. And, their privacy, health and safety must remain protected, as we move toward a greater dependence on information and communication technologies in the energy space.

Bermuda is risk averse, which is borne out of our isolation and indeed out of our desire to maintain our prosperity. We must learn to take reasonable risks, to encourage innovation and pilot solutions that can work for all of us.

The independent regulation of energy by the Regulatory Authority will ensure transparency of regulation, not only for the benefit of customers, but also for the benefit of potential investors.

We must also address the important subject of investment. Energy reform must be aligned with economic recovery.

If we can stabilize and potentially reduce our energy costs, then we make it easier for investors from hospitality and international business to do business in Bermuda.

We must identify barriers to investment, and find ways to ease that path while protecting Bermuda’s people and Bermuda’s environment.

We must establish incentives for conservation and efficiency, both for the consumer and for the power producers, so that we make the best use of our resources, whether they are indigenous or imported.

The reality for Bermuda is that more than $100 million dollars leave our shores every year to purchase the fuels we need. If even ten percent of that stays within the local economy, the community would certainly benefit.

Finding ways to use energy more efficiently must figure more strongly in our energy plan, with actual measures and incentives in place so that we achieve our conservation goals.

As we go forward, we must recognize that in all facets of energy, there is no single solution. Natural gas will not be ‘the’ technology that suddenly solves all our problems.

Robust legislation and independent regulation alone will not reduce energy costs. Renewables alone cannot provide for all our needs at once. Using less and controlling our demand are not enough.

As we open this Summit, it is my hope that we come away with the clear understanding that the best energy policies and the best legislative framework for Bermuda’s energy future can only be arrived at through our continued and open collaborative efforts.

Recognizing that no one element is more critical than another is the first step. I look forward to seeing how the conversations unfold, and how we walk forward together down this

road to energy reform as we develop the suite of technologies, policies, legislation and regulation that will set us on a stable path to a prosperous future.

Thank you

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