Caribbean Utilities Company has announced a 3.2% retroactive rate increase effective 1 June.
The power company said it has received approval from the Utility Regulation and Competition Office, OfReg, for the electricity rate adjustment.
CUC said in a statement that it expects the average residential customer’s monthly bill to increase by $4.88 based on the average monthly residential household consumption in 2023, which stood at 1,153 kilowatt hours.
CUC last increased its base rate in February 2023. That rate increase had been deferred in June 2022 amid high inflation to ease the financial challenges faced by consumers.
This latest rate increase, CUC said, was approved in accordance with the rate cap and adjustment mechanism contained in the company’s Transmission & Distribution Licence issued by the Cayman Islands Government.
CUC said rates are reviewed on an annual basis as outlined in condition 25 of the company’s T&D Licence.
“If a change is required, per the prescribed formula which uses inflation indexes as a reference, the change in the rate is enacted for electricity consumption effective June 1 of each year,” it said.
“Customers can expect to see a marginal increase in the facilities and energy charge component of their billing statements received in early July when compared to prior periods. Additional information on this rate change will be provided on customer bills.”
The increase comes after the power company announced its net earnings for the first quarter of 2024 had increased 18% to $6.2 million when compared to the same period in 2023.
Projected efficiency improvements
CUC said this latest energy charge increase will be offset in part by fuel efficiency savings from recent upgrades to two of CUC’s large generating units.
“There are plans to upgrade three additional generating units by 2025, which will bring further fuel efficiency savings to customers,” the company said.
The implementation of the 20-megawatt Battery Energy Storage System (BESS), CUC said, should bring additional fuel savings by August.
“It is estimated that this project will allow for annual savings on fuel factor charges for customers and therefore will offset the majority of the energy charge adjustments,” the company said.
Fuel factor rates, the company said, are “pass-through costs” from fuel purchases, so any fluctuation in fuel prices will affect the rates.
CUC has encouraged customers to be mindful of their electricity usage.
“During the summer months, the heat index and increased demand for air conditioning will lead to higher electricity consumption,” it said, pointing out that its website offers a number of energy-saving tips.
The terms of the CUC T&D Licence and the rate cap adjustment mechanism can be found on the power company’s website.
The current rate schedule can also be found on the CUC website or on the OfReg website.
Related Videos
The formula seems to be based solely on the cost of living increase, so no matter how much CUC’s profits increase they still get to up their rates.
Profits went up 18% but they increased fees 3.2%. WHY. If they are making more money and people can’t afford food why increase elec rates. Especially when tempatures are at record highs.