By NATARIO McKENZIE
Tribune Business Reporter
The head of a pressure group that has been pushing for lower Grand Bahama Power Company (GBPC) tariffs yesterday expressed scepticism over its promise not to increase rates for the next five years, suggesting it was “all a public relations cover-up”.
Reverend Eddie Victor, head of the Coalition for Concerned Citizens (CCC), while speaking with Tribune Business remained adamant that the utility should never have received approval for the 1.5 per cent increase in the average base rate earlier in the year.
“They should have broken down the rates and not increased the rates in the last application. I’m sure they have something built in. I believe they are going to recover that [hurricane restoration] money somehow. To me, it’s all a public relations cove-rup,” said Reverend Victor.
“The base rate should have been reduced. They need to give details to actually show that they are absorbing it. I’m sure they are going to absorb it within their business model, which should have reduced the rate of electricity.
“This means, then, that they are not going to reduce it for five years despite oil prices going down or changes in technology.”
In a statement issued on Wednesday, the Grand Bahama Port Authority (GBPA) said (GBPC had agreed to absorb Hurricane Matthew’s $27.5 million restoration cost itself and not pass it on to the consumer.
Sarah St George, the GBPA’s vice-chairman, said there would be no increase to Grand Bahama residents’ electricity bills between now and 2021, based on current rates.
She added that GB Power had also agreed to delay implementation of its Hurricane Self-Insurance Fund, which would have added an extra charge to customer bills, until all Matthew restoration costs had been recovered.
“As promised in our briefing of November 16, there will be no increase to customers’ rates for the next five years when compared with 2016,” Ms St George said.
“In addition, GBPC has also agreed to delay the previously approved Hurricane Self-Insurance Fund until Hurricane Matthew costs are fully recouped. We wanted to announce this as soon as possible to reassure everyone of rate stability as we move towards the eve of 2017”.
The plan revealed by the GBPA is the opposite of GB Power’s immediate post-Matthew intentions, which were to recover its costs from consumers - but in way that did not cause further financial and economic hardship.
Emera, the Canadian-headquartered utility that is GB Power’s 80.4 per cent majority shareholder, confirmed its intention to reclaim Hurricane Matthew restoration costs from Grand Bahama businesses and residents last month.
Emera’s financial filings for the 2016 third quarter said then that the rebuilding of GB Power’s transmission and distribution network was estimated to cost $25 million.
“The Q3 2016 results for Emera Caribbean do not include any of the approximate $25 million of restoration costs, which are expected to be capitalised and recovered from customers over time,” Emera said of GB Power.
In return, the GBPA has approved the $27.5 million “prudent costs” incurred in restoring GB Power’s “uninsurable” transmission and distribution network, which will be recovered over a five-year period starting on New Year’s Day 2017.
The Port also praised the utility for its restoration effort, which would have lasted 15 months and caused “irremediable” harm to Grand Bahama’s economy, had it not brought in foreign crews and resources from Emera’s international network.
“We have verified power restoration costs quantified at $27.5 million, comprising extensive labour and materials, which were required during the island-wide hurricane restoration exercise,” the GBPA said.
“The GBPC recovery operation involved local and off-island crews, without which it is estimated the restoration would have taken 60 weeks (15 months) rather than six weeks.
“The adverse economic impact resulting from a slow restoration - with its extended hardship and inevitable loss of business, tourism, trade and jobs - would have implied costs many times higher for the Grand Bahama community as a whole, and possibly proved irremediable, according to studies undertaken.”
The GBPA added: “The Hurricane Damage Assessment Summary provided by GBPC included: 1,362 damaged transformers, 2,025 damaged poles, 1,150 damaged brackets, 6,000 damaged insulators, 3.09 million feet of downed conductor wire; and 1,000 damaged arrestors.
“Technical experts, 200 additional linemen plus local linemen, worked over 95,000 hours. Other workers and 130 additional pieces of mobile equipment were brought to bear on the natural disaster.”