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Provider Rejects Insurance Demand Over Renewables

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A  Bahamian renewable energy provider yesterday disagreed “completely” with the requirement for residential suppliers to obtain general liability insurance, arguing that this was “unwarranted” and an added expense.

Phil Holdom, head of Alternative Power Supply (APS), told Tribune Business that

anything which adds to the cost of alternative energy solutions makes them less attractive.

The Utilities Regulation and Competition Authority (URCA), in its assessment of Bahamas Power and Light’s small scale residential offering (SSRG), introduced a requirement that residential suppliers of renewable energy to the grid obtain general  liability insurance to guard against BPL personnel or others suffering harm.

“With regards to the need for liability insurance, we completely disagree,”Mr Holdom said. “There has never been a case of a utility worker being harmed by a UL-listed, industry standard grid tied inverter.

“The inverters derive their ability to be connected to the grid by receiving their signal from the grid. If the grid is down, the inverter is disconnected, period.”

Mr Holdom added: “With that logic, all generators should require liability insurance, since it is more likely that a failed transfer switch would damage a line worker.

“If insurance is not required for other devices connected to the grid that are UL-listed, meet UL1742 and are IEEE, then insurance should not be required for inverters.

“Electrical engineering standards and historical data from decades of grid-tie usage around the world do not support the claim that insurance is needed ‘in the event that BPL personnel or others suffer harm’.

Mr Holdom said US-based Southern Power, which purchased PowerSecure, BPL’s manager, is a major installer of grid-tied megawatt solar plants in the United States. 

“I could understand if these are industry standards, but they are not,” said Mr Holdom.

URCA has also mandated that mandated that BPL alter its renewable energy interconnection agreement to give homeowners certainty of a 15-year payback, and make it clear that ‘fuel charge’ compensation is only temporary.

The regulator, in its assessment of the energy monopoly’s small scale residential offering (SSRG), said the “variable” length of interconnection agreements was unsatisfactory for Bahamians seeking a return on their renewable energy investments.

The SSRG programme is designed to kick-start BPL grid tie-ins for residential solar and wind systems that are up to standard, and URCA said: “URCA notes that BPL’s proposed draft suggests that the term of the interconnection agreement would be variable, depending either on the length of BPL’s ‘pilot programme’ or other factors, which are not clearly set out.

“URCA considers that in order to properly secure customer-generator investments in renewable generation systems, the agreement must be of fixed length, which must be of sufficient duration to ensure recovery of the customer-generator’s investment. URCA has therefore inserted an amendment to fix the term of the agreement at 15 years.”

URCA also ordered that BPL amend its interconnection agreement such that it acknowledges the method for calculating consumer compensation may be changed “from time to time”, with inital payments equal to its fuel charge only an “interim solution”.

BPL had also proposed that if the homeowner supplies more energy than they consume, a credit will be applied to their account and carried forward into the next month. Credits will roll forward until October of each year, when they will be reset to zero.

URCA, though, rejected this as “unfair”. It added: “BPL has advanced no justification for the proposal that customer-generators would not be fully compensated for the electricity which they generate and supply to BPL.

“URCA has amended the language to provide for payment by BPL to the customer-generator on an annual basis, where the customer’s account holds a credit balance after offset of payment for power taken from BPL.”

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