HAMILTON, Bermuda (CMC) – The Bermuda Electric Light Company (Belco), the island’s sole power provider, has pledged its commitment to lowering electricity prices following stinging criticism of the firm in Friday’s budget presentation.
Finance Minister Bob Richards said that while Belco has had a “generally good record” for reliability, Bermudians had “paid dearly” for the lack of competition in electrical power and he planned to end Belco’s monopoly.
Richards told the House of Assembly that it was time to address Belco, as well as government’s inefficiencies which were both eroding Bermuda’s competitive position as a jurisdiction that provides value to customers.
“One of the reasons that Bermuda’s recession has lasted five years is due to its (Belco’s) loss of competitiveness,” he said.
“A significant part of our uncompetitiveness is high cost, a big component of which is the high cost of electricity. The break-even point for our hotels and other enterprises is pushed significantly higher by the high cost of electricity, making them less competitive versus other jurisdictions where costs are lower and therefore more attractive to investors.
“Also, the high cost of electricity is a great burden for the Bermudian people whose buying power is reduced due to the high cost of just keeping the lights on.”
But the power provider hit back at Richards’ comments, saying that 57.5 per cent of Belco’s costs were made up of the price of fuel and taxes.
A Belco statement added: “Efficiency is very important to Bermuda Electric Light Company Limited, and it is a topic always under review within the company, looking at alternatives and options.
“Belco recognises the impact the overall price of electricity has on the cost of living and the cost of doing business. Belco is committed to getting the price of electricity to be lower.”
The power company said it will be submitting an integrated resource plan to government with alternative fuel options, generation resources and energy- efficiency initiatives that are now economic and reliably feasible.
