The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Grand Bahama Power Company has “not changed its position one iota”, despite URCA executives yesterday expressing hope it will negotiate a settlement to their regulatory dispute.

Well-placed Tribune Business sources said that while the Freeport-based energy monopoly was willing to listen to the regulator’s viewpoint, it had not changed its stance that the Grand Bahama Port Authority (GBPA) - not URCA - has the exclusive right to regulate utilities in the Port area.

“The litigation is still afoot,” one contact, speaking on condition of anonymity, told this newspaper. “There have been overtures from URCA to have discussions with GB Power and its representatives regarding the application of the Electricity Act to the Port Area.

“Those discussions have not taken place. Both sides need to fix a date for them to happen, but GB Power’s position is as reflected in the court process; it has not changed one iota. They’re not sure what URCA hopes to achieve, but as a good corporate citizen GB Power is prepared to sit down and listen.”

GB Power’s seemingly ‘dug in’ position is likely to dismay the Utilities Regulation and Competition Authority (URCA), which is hoping that negotiations will resolve the dispute over whether it or the GBPA has regulatory authority in Freeport.

Shevonn Cambridge, URCA’s head of energy regulation, yesterday told Tribune Business: “I think that right now we’re at a position where there’s discussions between the parties to try and reach an amicable resolution of the matter.

“I don’t think it’s a full legal-type dispute right now. There’s discussions going on about it. I don’t think they’re [GB Power] objecting to being regulated. It’s a matter of whether they’re regulated by the Port Authority or URCA, or if it’s going to be a shared responsibility.”

Mr Cambridge denied that the ongoing litigation, launched more than a year ago, was an impediment to URCA’s ability to fulfill its mandate under the Electricity Act and regulate the entire Bahamian energy sector.

“The important thing is ensuring the quality of service to the consumer,” he added. “As we deal with other licensees, consumers will see the benefits of it, and whether it’s a legal thing or push from the consumer base that’s how this thing works.”

Yet GB Power’s position seemingly undermines URCA’s optimism that it will itself be able to license the Freeport-based utility via a Public Electricity Supplier License (PESL), once its August 16 licensing consultation is completed.

Acknowledging that the one-year license it was supposed to issue to GB Power last year never happened, URCA’s consultation document stated: “After this consultation process, URCA proposes to renew the PESL issued to BPL (Bahamas Power & Light) and also grant a PESL to GB Power.”

The URCA document also proposes the creation of an Authorised Public Supplier License (APSEL), which could be interpreted as an attempt to get around GB Power’s legal action and the provisions of Freeport’s founding treaty, the Hawksbill Creek Agreement.

This states that URCA can grant such a license to an entity or person “who has been granted an approval in writing by the Grand Bahama Port Authority to construct and operate an electricity supply system, and perform GTDS (generation and transmission/distribution services) functions in the Port area”.

However, Tribune Business was told that GB Power is holding firm to its position that the Hawksbill Creek Agreement gives the GBPA absolute regulatory authority for energy and utilities in the Port area.

“That agreement is really clear from our perspective,” said one contact, speaking on condition of anonymity. “The Port Authority has the sole and exclusive right to supply, and establish the terms and conditions of supply, for electricity and utilities situated in the Port area.”

To modify that provision, the source pointed out that approval by four-fifths of the GBPA’s 3,500 licensees, together with the Government and GBPA itself, would be required.

GB Power initiated its legal action last summer to prevent URCA “from regulating, or seeking to exercise licensing and regulatory authority”, over it.

Its amended statement of claim, filed on July 7, 2016, wants the Supreme Court to declare that GB Power can carry on its business without requiring a public electricity supplier licence from URCA.

GB Power’s action is founded on the basis that, as a GBPA licensee, it is licensed and regulated by the latter via the Hawksbill Creek Agreement - and not by URCA and the Electricity Act 2015.

It is arguing that the Electricity Act’s sections 44-46, which give URCA the legal right to license and oversee energy providers, “are inconsistent, and conflict with, the rights and privileges vested in [GB Power] and the Port Authority” by the Hawksbill Creek Agreement.