Geopolitical tensions between Iran and the United States have been a key driver behind recent fuel price increases hitting Barbados Light & Power Co Ltd (BL&P) customers, but the company and Government have been working to limit the damage.
That was the word from BL&P’s managing director Roger Blackman, who said a combination of strategic fuel hedging and a Government subsidy has prevented consumers from feeling the full force of the global price surge.
He said the BL&P had locked in fuel purchases at US$95 and subsequently US$85 per barrel, cushioning customers from prices that would otherwise have soared past US$100. The Government, he added, has also stepped in with a subsidy designed to ensure the full cost was not passed directly to bill-payers.
“While fuel prices would have gone north of US$100, because some prices were hedged at $95 and subsequently US$85, those higher prices would have been cushioned for customers through those hedging arrangements,” he said.
Blackman, speaking to the DAILY NATION at the utility’s 115th anniversary time capsule ceremony in St Lucy yesterday, also pointed to a recent reduction in oil prices as a welcome sign.
“Thankfully, we’ve seen a dip. I don’t know how long it will last, but we’ve seen a dip in oil prices this week. We’re hopeful that that continues and that prices continue on the downward trend.”
He said the drive toward renewable energy remains the most sustainable answer to the volatility consumers were currently experiencing.
“Over the longer term, renewable energy, while it does have some challenges as well and there are costs associated with it, at least those are fixed costs at the beginning and you’re shielded from the spikes and valleys that may occur with the oil.”
He said that with the energy sector facing complex trade-offs between affordability, reliability and sustainability, the days of experts making decisions in isolation were over, and broad consultation among stakeholders was the only way to arrive at a plan with genuine public buy-in. (DDS)