$1.2m spent for gov’t electricity-assistance programme

The Cayman Islands government has paid out $1.2 million in the first month of its electricity relief programme, launched to combat rising fuel prices that are driving up utility bills.

CUC president and CEO Richard Hew, speaking on the 10 Aug. episode of the Cayman Compass Facebook talkshow The Resh Hour, said some 22,000 CUC residential customers have already benefitted from receiving assistance through the relief programme.

This, he said, amounts to nearly 80% of the utility company’s 26,000 residential customers.

Relief programme not ‘perfect’, but effective

However, he said, the programme is not “perfect” as there are those who missed out on the credit to their accounts to help navigate increased bills over the summer months due to increased air condition use and high fuel prices.

Even so, he said, it has provided some limited measure of relief.

“I do believe it is an effective, efficient way to get to the majority of people who need that relief at this time with the high fuel prices,” he said.

Under the government-funded programme, which commenced in July, those whose monthly electricity use is higher than 101 kilowatt hours but lower than 2,000 kWh receive a credit on their bills for the summer months. The amount of that credit is paid by government.

This means the majority of customers will be charged 15 cents per kilowatt hour, regardless of how high the price of fuel gets under the programme.

Responding to queries on why a cap of 2,000 kWh has been put in place, Hew said government was trying to strike a balance in terms of reaching as many people as they thought “would appreciate and benefit from the relief programme”, but could not afford to make it available to everyone. Therefore, it was decided to base it on consumption use.

Richard Hew’s top energy conservation tips

• Reduce A/C use
• Do regular servicing of A/C units
• Check and maintain proper insulation at home to reduce energy consumption from A/C units
• Set A/C to a higher temperature, for example, 85 degrees to reduce energy consumption

Hew acknowledged there have been complaints over the higher bills this month, but he reminded this would have happened once the usage crossed over 2,000 kWh, even if it were by a single digit. So, for example, a person whose bill shows 2,001 kWh would not get the credit.

He added that CUC is also feeling the pinch with the spike in fuel prices and rising inflation.

“It is not a good time for CUC customers and neither for CUC,” he said. “We don’t profit from fuel costs. We pass those costs through without mark-up, and … encouraging people to conserve,” he said.

Hew pointed out that prices are starting to drop in the US markets and “hopefully, towards the end of the year, when we have cooler months and lower consumption for the homes, we’ll also see that the fuel costs have come down somewhat”.

This, he said, was the idea behind the relief programme.

The full cost of the initiative to government remains unclear, but Premier Wayne Panton had previously indicated that around $5 million would be set aside to help families pay their electric bills during the summer months.

Hew said the utility is doing its part to assist having deferred its rate increase to next January.

“We are absorbing a lot of the costs right now,” he added. “I can tell you the inflation is running high. The materials that we have to purchase are increasing in cost significantly. So we are seeing the costs increases [and] we are holding back on the rates until January. … Hopefully, in the low-consumption months, it will not have as much of an impact on consumers compared to the high consumption months.”

Inflation, supply chain issues hit CUC plans

Hew said the rising cost of inflation and challenges with supply chains have also impacted the utility’s plans for upgrades and projects, such as installing batteries to maintain grid stability when the supply of renewable energy drops off.

“We need to put in batteries to keep the system stable. We do have a project that we’re working on now but it will not be delivered until late next year. We ran into the same supply-chain issues with that, but when that is in, we’ll have grid stability,” he said.

The way it will work, he said, is charged batteries are connected to the grid, and when any issues arise – either with solar dropping off or one of CUC’s generators going off grid – “the battery will immediately start to discharge into the grid and make up for the difference”.

More solar

He said the utility is also looking at a project next year to help with adding more solar energy into the grid, and that with a combination of solar power and batteries, CUC can bring this on board fairly rapidly.

“It just means getting a lot of the utility-scale projects going as well,” he said. “More like the Bodden Town solar five megawatts [project]… even much bigger than that – 10 to 20 megawatts combined with battery storage, we’ll be able to, by 2030, have over 60% of the energy on the grid come from solar.”

CUC, he said, is committed to drive down emissions.

The vision, he said, is that the utility will have enough solar and batteries for use during the daylight hours and part of the evening hours, and the diesel generators will only be fired up when the batteries power down at night.