The Tribune

By NEIL HARTNELL

Tribune Business Editor

Grand Bahama-based businesses and households are paying 383 per cent more in energy costs than their Florida-based counterparts, a Freeport businessman yesterday telling Tribune Business this was the main reason for the island's 20 per cent-plus unemployment rate.

Jeff Butler, head of the Butler Group of Companies, said electricity costs of between $0.34 to $0.4o per kilowatt hour (KwH) were crippling commerce and investment on Grand Bahama, with none of the "major players" looking to expand operations or encourage other foreign investors to establish themselves on the island.

He supplied Tribune Business with data compiled for him yesterday by a Fort Lauderdale-based company, comparing Grand Bahama's energy costs with those for Florida and Barbados - the latter being another Caribbean territory where Grand Bahama Power Company's 80 per cent-plus major shareholder, Emera, operated.

Based on a household using 1500 KwH per month, something he said was average for a tropical climate with air conditioning use, Mr Butler's study showed that Florida Power & Light customers were paying $131.5 per month plus taxes.

But when it came to GBPC's rates and furl surcharge, Mr Butler's figures showed that a Grand Bahamian household consuming 1500 KwH per month would see a monthly power bill of $635.5 - a 383 per cent increase, or close to five times' as much, over their Florida counterparts.

Energy costs on Barbados were not as high as those in the Bahamas, although even here they stood at $518.98 per month, a 294 per cent increase over Florida costs. Grand Bahama's energy prices, too, were 22.5 per cent higher than their Barbados comparative.

Asked by Tribune Business about the impact this was having on the Grand Bahama private sector, and potential investment on the island, Mr Butler said simply: "There is none.

"I've spoken to all the major players here, and while I don't want to name any of them, they all said they are not expanding, and are not encouraging any of their friends in Italy, France, Germany or Canada to come here because of the power costs."

He added that these views held despite these larger companies paying a discounted $0.34 per KwH rate. "How can a society advance and pursue investors and jobs when it cannot provide adequate, economically viable power?" Mr Butler asked. "The arbitrarily determined fuel surcharge is the nails closing the lid of our coffin."

Arguing that the $0.40 per KwH rate that many Grand Bahama-based businesses and households was "60 per cent higher than it should be", Mr Butler also took issue with electricity usage, which he said had "doubled".

He explained: "In my case we have documents from the equipment manufacturers clearly stating that our rack refrigeration system, at the ridiculous charge of $0.4c per KwH, would cost a maximum of $9,000 per month.

"This rack uses 89 per cent of the electricity, with the balance being the overhead lights, computers and miscellaneous other units. [Grand Bahama Power] is billing us an average of 60,000 KwH or $24,500 per month, well over double what it should be."

Mr Butler told Tribune Business that he had been provided with the supporting documents and calculations by Emerson Electric, which supplied the same equipment to the likes of Publix, and had based their calculations on the Bahamian climate and likely usage.

"We can't make any money, we can't pay the rent and can't hire anyone else," Mr Butler added. "I have a house in Fort Lauderdale where the monthly bill was $51.48, and that's with the AC running in a three-bedroom house.

"The main reason for our unemployment rate being over 20 per cent-plus on Grand Bahama is the power. None of the major companies, no one, can hire, no one can expand, everyone is cutting back.

"Foreign investment is key to Grand Bahama, and what company is going to come here into an area with $0.40 per KwH power. Look at the glass company. They're gone. They had 150 employees. They're gone. They had an $8 million investment on the Queen's Highway. That's gone. I don't have any place to go, so I'll stay and fight."

Describing renewable energy as "a small bandage for lessening the burden", Mr Butler said the time and investment cost associated with them ensured they were not the answer to the problem yet.

While the Government had made solar panels duty-free, Mr Butler said Grand Bahama Power Company had yet to permit them to be tied-into its grid, something that negated net metering and net billing, and the possibility of companies selling surplus power back to the utility.

In addition, the cost of solar controllers had not come down, Mr Butler saying such systems typically required an outlay of $3,000-$8,000.