Mr. Speaker, Honourable Members may recall that in September 2024, the Government tabled the Electricity Amendment Act 2024, which introduced a new licensing framework under the Electricity Act 2016 for developments generating electricity in excess of 500 kilowatts.
This new licence class, referred to as the Bulk Generation Sole Use Installation or BGSUI Licence, was created to provide a pathway for entities to produce renewable electricity for their own use at their principal location.
Mr. Speaker, the intent of this licence was to address critical energy challenges faced by important public institutions such as the National Sports Centre, which offers accessible services to the public but faces high operational costs, including overhead electricity expenses.
Similar challenges are faced by other government facilities and statutory bodies that provide affordable public services. These institutions must be empowered to reduce their energy expenses to maintain operations that directly benefit the people of Bermuda.
I am pleased to update this Honourable House that the Regulatory Authority is now in a position to accept applications for BGSUI Licences.
Mr. Speaker, under the conditions of the BGSUI Licence, the licence holder is permitted to generate electricity above the 500 kilowatt threshold solely for its own use at the principal location.
However, to protect the financial sustainability of the electricity grid, the licence limits the amount of electricity that may be sold to the Transmission, Distribution and Retail licensee to no more than 30 percent of the total electricity generated in any given month.
Any electricity generated above this limit cannot be sold and will not be compensated. This condition ensures that the licence is used primarily for self-supply and not as a backdoor mechanism for commercial resale.
Mr. Speaker, while the BGSUI Licence is an important step in helping government departments and large institutions reduce their energy expenses, the Government must also protect those residential customers who continue to rely fully on the grid and who may not have the financial means to invest in solar photovoltaic systems.
If the cost of maintaining the grid is shifted away from large consumers who self-generate and toward households who cannot, the result would be an unfair burden on those least able to pay. For this reason, the Government and the Regulatory Authority are working closely to ensure that fixed and variable electricity costs remain fairly allocated.
This includes reviewing legislation, licensing conditions and regulatory tools to prevent unintended consequences that could undermine our goal of energy affordability for all.
Mr. Speaker, this Government remains committed to promoting clean, renewable and affordable energy for Bermuda, while safeguarding the interests of all ratepayers. The implementation of the BGSUI Licence strikes this balance, offering a path forward for large institutions in need of energy cost relief while maintaining regulatory discipline to protect the public good.
Thank you, Mr. Speaker.