Caribbean Utilities Company increased its operating income by US$1.1 million to $29.5 million last year on the back of 6% higher kilowatt-hour sales.
Average commercial consumption, warmer weather conditions and a 2% increase in customers all positively impacted electricity sales.
The higher operating income, as well as lower finance charges and higher other income, increased net income for financial year 2019 by $2.3 million to $29.1 million.
Capital expenditures of $60.6 million grew by $2.6 million, or 5%, over 2018.
CUC president and CEO, Richard Hew, said the strong financial results were primarily driven by increased electricity consumption of residents and businesses participating in Grand Cayman’s growing economy.
The company also made “excellent progress” on its capital investment activities including building new substations and control room, and upgrading monitoring and controls technology to increase service capacity and reliability, Hew said in a press release announcing the results.
Last year, CUC received OfReg approval for a 20-megawatt utility-scale battery project which is currently undergoing tendering. Hew said the battery storage would provide the grid stability needed to integrate higher levels of intermittent renewables.
The utility company closed access to its Customer Owned Renewable Energy programme in 2019. The popular programme connects residential and commercial solar panels and wind turbines to the grid but the allocated capacity for renewables has been fully subscribed so that no new customers can be accepted.
In January 2018, CUC introduced the Distributed Energy Resource programme to replace CORE. Under the DER initiative, customers sell to CUC excess electricity exported to the grid at an avoided cost-of-generation credit rate, stated the release.
The company said it incorporated lessons learned by other jurisdictions from early net-metering programmes and bills DER customers under a demand-rate structure. The use of demand rates aligns the fixed costs of providing a grid interconnection and standby provision to the customer with demand charges, avoiding any potential cross-subsidisation between DER and non-producing customers.
At the end of 2019, there were 432 CORE customers connected with 5,611.2 kilowatts of renewable capacity and four DER customers with total installed capacity of 494 kilowatts.
After adjusting for dividends on the preference shares of the company, earnings on Class A Ordinary Shares for the year were $28.1 million, or $0.84 per Class A Ordinary Share, compared to $25.8 million, or $0.78 per share in 2018.