Tuesday, April 16, 2024

Cave: Investor concerns over BL&P proposals


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Fortress Fund Managers’ investment director Roger Cave has suggested that the Barbados Light & Power’s Renewable Energy Rider will not attract significant investment under its current structure.
However, he said Barbados would not have to reinvent the wheel to come up with a system which would attract capital since other countries had found solutions.
He made the comments during the Fair Trading Commission’s recent public consultation on the programme, which is available to customers with renewable resource generation facilities.
Cave told the audience at the Lloyd Erskine Sandiford Centre that the large-scale adoption of renewable energy would require either debt or equity capital.
“One of the challenges that we face in the investment business is that we’re starved for investment opportunities and I really believe that this is an area that offers tremendous opportunities,” he said.
He, however, pointed out that there were a number of concerns for investors surrounding the BL&P’s proposals including the timing, method and frequency of payments for energy sold to the grid.
Cave also said there was uncertainty surrounding cash flows since returns were tied to fuel costs.
“Unless you’re a commodities trader, people don’t like to take on the risk . . . . None of us knows where energy costs are going although we will probably all assume that in the long term they will probably rise,” he said.
Cave also suggested that the limit of 150 kilowatts per commercial installation was restrictive and would hurt economies of scale.
“Obviously larger systems are going to reduce the cost to the investor in the system.
“If we use an example, say Cave Shepherd in Broad Street, where we’ve tendered to put on a 150 kilowatt system, that doesn’t use the whole roof space and even if it did, I think the 150 may only use 20 per cent of the energy costs there.
“I can understand why the limits are there hearing the impacts on the grid but from the point of view of the investor I believe there should be greater flexibility there,” he said. (NB)


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