FTC grants review
THE Fair Trading Commission has allowed the Barbados Light and Power (BL&P) a review of a Commission decision to recover over $20 million for its 5MW energy storage device (ESD) through the Fuel Clause Adjustment (FCA).
The FTC decision was handed down in April this year. However, it said on Monday that having assessed the company’s submissions for the review, it will allow it to proceed with a review and variation to the decision.
“This motion seeks to review and vary the approach used by the Commission in relation to the ascribed heat rate targets and failure to tap the penalty or reward,” said the FTC which is the regulator.
The Company has also requested an order delaying the implementation of that part of item three of the decision, which relates to the establishment of heat rate targets until final determination of the Motion, the Commission said.
Accordingly, the Company believes that if the Commission’s decision on heat rate targets is implemented before the Motion is heard and determined, it would be exposed to unlimited financial exposure which it said could result in irreparable harm and may compromise its ability to deliver a reliable and affordable electricity supply to customers.
The FTC said that after assessing the Company’s submissions on the delay, it issued its decision on September 10, 2018 granting the delay and pending its determination of the Motion to Review the decision.
In an application submitted to the FTC in August last year, BL&P had said it was seeking to recover $22.9 million – the full cost of the ESD, as well as return on capital over its warranty lifetime.
In addition, the power company had proposed to share a minimum of five per cent of the fuel savings with customers each year.
The ESD, which carries an operational warranty of ten years, cost the utility company $19.5 million.
In announcing its decision on Monday, the FTC said it has determined that that it will conduct this matter as a written hearing pursuant to Rule 37 of the Utilities Regulation (Procedural) R, 2003, to determine the threshold question and a review on the merits.