Bahamas pressing ahead with energy reform, inks two power agreements

The Bahamas government has issued power contracts that it expects to result in modern, reliable and affordable electricity for 14 islands.

Prime Minister Philip Davis also indicated that by 2030, at least 32 per cent of the country’s electricity needs will be fuelled by solar, surpassing the global target of 30 per cent, at the signing ceremony for power purchase agreements, or PPAs, with two Bahamian partners, to improve power supplies to the Family Islands.

In 2021 when Davis took office, he said his administration has encountered a power grid and power generation system on life support; and the Bahamas Power and Light Company Limited was “drowning” in more than US$500 million in debt, plus another US$100 million in unfunded pension obligations.

“At the same time, our energy infrastructure required US$500 million in critical upgrades to prevent catastrophic failure,” Davis said, noting that in New Providence, 60 per cent of power generation equipment needed replacement, while the Family Islands were in even worse shape, with 80 per cent of equipment requiring replacement within five years.

“For Bahamian families, our energy failures caused unnecessary hardship for a population that was still staggering from the effects of Hurricane Dorian, COVID-19, a deflated economy, and crippling inflation,” he added.

So the administration set about doing energy reform that would span not just New Providence and other major islands, but also “every island where Bahamians live, work, and raise their families”.

It required taking on multiple Bahamian partners.

“These partnerships will bring modern, reliable, affordable electricity to islands that have, for too long, endured ageing infrastructure, frequent outages, and exorbitant costs. Through these agreements, we will establish solar microgrids combined with advanced LNG and multigas systems across nine different areas in our Family Islands,” he said.

The hybrid approach will see The Bahamas harnessing its “abundant sunshine, while introducing cleaner fuels to ensure that our power needs are met”.

“All of our partners are Bahamian-owned enterprises with the resources to expedite development, to ensure that our people will benefit from these changes as soon as possible.

In fact, each one of the PPAs we’ve signed this year will be initiated before year’s end and will be completed in 2026,” Davis added.

One of the agreements was signed with Family Island Microgrid Company, which will develop and operate new energy systems on five islands, namely Harbour Island, Bimini, Moore’s Island, Farmer’s Cay, Black Point and Staniel Cay in the Exumas.

The second partnership with RenugenPro Company Limited will deliver solar, battery energy storage and LNG facilities to San Salvador, Long Island and Cat Island.

Prime Minister Davis said that as large-scale solar and hybrid facilities spring up throughout the archipelago, Bahamians will benefit immediately from the energy reforms.

“These are not pilot projects. Nor are we talking about vague promises of improvements in the distant future. These projects are large-scale, fully funded, carefully designed systems that will be operational within 18 months,” he asserted.

“As we reap the immediate benefits of integrating large-scale solar and cleaner fuels, we are simultaneously repairing and modernising our transmission and distribution systems to be even more efficient,” he said.

The reform programme, with over US$1 billion in targeted investments, represents the single greatest investment in energy reform in the country’s history, said Davis.

“No more sky-high electricity bills at the end of each month. No more sweating in the dark at night because of power failures and load-shedding. No more appliances shorting out and food going bad because the power went off for far too long,” PM Davis declared at the signing ceremony.

“That is the energy future we are striving for. That is the future Bahamians deserve,” he said.

CMC