Minister: ‘Decision Is Excellent News For The RA’
Minister of Home Affairs Walter Roban “threw his support behind the RA for protecting the interest of residents and consumers following the court’s finding in favour of the Regulatory Authority [RA].”
Minister Roban explained, “This decision is excellent news for the RA and the ratepayer. The RA is responsible for looking after the end-user’s best interests, as noted in Section 6 of the Electricity Act 2016, the purposes of the Act. Paramount among those is promoting the interests of end-users concerning prices and the adequacy, reliability, and quality of electricity service.”
“The regulator must challenge any actions within the regulated industries that do not appear to support consumer price and cost stability.
“The matter at hand was a dispute primarily over the weighted average rate of return. In a challenging economic climate, the utility cannot expect to make an unbridled profit on the backs of the ratepayers, many of whom are under significant economic duress.
“That aside, the utility is indeed a privately owned company- who, in 2023, lauded that BELCO did well and turned a decent profit in the past year in the face of other sister companies within the Algonquin group having endured a challenging year. That statement alone is inconsistent with the utility’s messaging around this case. Although a private company, they are in the service of the public- and that essential duty cannot be disregarded or downplayed.
“I must note that the RA can only consider those used and valuable assets and any expenses prudently incurred in their considerations and calculations to arrive at electricity rates. That means the utility’s assets must be in good working order, being used and functioning as they should for servicing the people of Bermuda.
“I fully support the Regulatory Authority for giving the highest priority to one of its principal functions under section 12 [b] of the Regulatory Authority Act 2011, “To promote the interest of the residents and consumers.” which is of paramount importance in an environment of inflation and high cost of basic necessities faced by persons and businesses.
“I applaud the willingness of the regulator to defend their decisions around these issues, especially with adherence to section 12[b] of the Act and other related provisions.
“Good regulation ensures fairness, and not just for the utility, and I commend the RA for upholding their duties to the ratepayer. Hopefully, this decision is a harbinger of things to come for the Regulatory Authority and regarding future rate cases.”
The Supreme Court ruling follows below [PDF here]:
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Just wait for the costs associated with an offshore wind farm that get rolled into our BELCO bill!!! The costs that Greenrock and the RA refused to estimate.
Greenrock and the RA refuse to show the Estimated Consumer kWh Rate (ECkR) cost range that will be delivered to consumers and businesses by BECLO purchasing wind-generated electricity. The ECkR is critical to the decision-making process because it shows ALL COSTS involved in delivering electricity to consumers. Why is it not being disclosed? Because the ECkR would be shockingly greater than our current rate and end the preliminary phase!
Examples of costs not being disclosed: Subsidies, tax breaks, guaranteed returns to investors, turbine maintenance, grind connection, Government taxes added in to make up for the lost fossil fuel tax revenue, BELCO markup, etc. Showing the ECkR and how it was calculated would prove that the overall cost of a wind farm and the future cost of wind turbine-generated electricity to Bermudians is economically oppressive. Release the spreadsheet, name, define, and list all the costs in the calculation. Name, define, and list all costs NOT included in the calculation and why they were excluded.
Greenrock should be building the offshore windfarm and reaping the profits!
Too funny. Greenrock could only dream of having $300+ million at hand to spend.