Domestic light bill subsidy extends to year-end
(CNS): The Cayman Islands Government has announced a three-month extension to the Electricity Assistance Programme (EAP) until the end of the year to help the public cope with what would otherwise have been a significant leap in monthly bills. Even though we can expect the next three months to be cooler than the last three summer months, the fuel burned in October and in the coming months was purchased by CUC at a time when oil prices were at their recent peak.
Given the period of unusually high fuel costs, the government will continue the rate cap for eligible residential customers who are consuming between 101 and 2000KWh. An average household bill in Grand Cayman consuming 1,800 kWh per month will see a saving of around CI$90.
The subsidy goes beyond CUC’s own relief programme, which was approved by OfReg and caps fuel factor costs at CI$0.20 per kWh. However, that is not a grant programme and the power supplier will recoup this reduction throughout 2023. The cut comes when fuel cost for electricity consumption in October is the highest so far for the year but they are expected to decrease for November’s consumption, CUC has said.
“CUC is committed to providing ongoing support to its customers through these difficult times and it was important that we seek approval from OfReg to provide fuel factor relief at this time,” said CUC president Richard Hew. “This will ease the burden on residents and businesses at a time when they need it most. Global events continue to negatively impact local businesses and the cost of living, not only in the Cayman Islands but around the world.”
He said CUC was committed to doing what it could to assist customers during these tough times while at the same time taking steps to remain a reliable and financially viable operation.
There has been no indication so far from the Dart, the new owners of Cayman Brac Power and Light Co., whether or not Cayman’s wealthiest businessman is going to offer residents in the Sister Islands any help.
But as had been projected, increased residential consumption over the summer months, combined with rising fuel costs, resulted in significantly increased electricity costs, which appear set to continue even with the help from CUC. The government has already spent more than $5 million on the summer subsidy programme and the extension is expected to be a similar amount. It has helped more than 22,000 households across Grand Cayman, Cayman Brac and Little Cayman.
Premier Wayne Panton said the government is fully committed to preparing for further price increases and reducing one of the biggest household expenses for most families.
“Around the world, the soaring cost of living is being driven in part by the cost of fuel, and the resulting cost of energy,” he said. “Here at home, our government is committed to helping our people get through these challenging times by offering a direct subsidy to their electricity bills. This will help blunt the impact of the sharp increases in utility bills, providing much-needed relief for those who need it.
“Although fuel costs are expected to plateau in the coming winter months, fuel costs remain relatively high when compared to a year ago. For example, at 24 cents per kWh, October’s fuel cost estimate is double what it was in January of this year. This means that even though consumption should be going down because it is cooler, bills may remain relatively high for most households,” Panton added.
“In the face of increasing costs of living, the three-month extension of the electricity assistance programme is yet another of more than a dozen initiatives put in place by government to help lower and manage costs for residents during these difficult times.”
These include the free school meals programme, the displaced tourism worker stipend, health insurance payments, cost of living adjustments for the public sector and honorariums to public service pensioners. The programme initially announced in June 2022 gave households a government subsidy applied directly to their electricity bills, effectively reducing what customers had to pay to their utility company. Between July to September 2022, customers on average saved a total of CI$66.20 on their monthly utility bills.
Panton said the extension was part of the government’s people-driven commitment to provide comfort to those currently enduring difficult times.
“As a government, we understand how hard these times are for families, senior citizens and young adults, and we will not make excuses or say that nothing can be done,” he said. “That is why we have been working diligently since May last year to put in place more than a dozen initiatives to lower direct costs and help people protect their income as we brace ourselves to get through the economic challenges that will continue to face us for the foreseeable future.
“We understand that things are tough, and people are experiencing financial stress, but we are here to help and give our people hope. If we each do our part, and we work together, we can get through these tough times,” Panton added.
The government’s extended programme will continue to provide assistance to over 80% of the residential customers of CUC and Cayman Brac Power and Light over the next three months.
See government video message and the CUC release below:
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Cayman’s economy is so tilted to help the rich!
Eg. Blue collar workers earning minimum wage of $4.50 or $6 hourly also have pension and health deductibles taken out. Pariah state in the making.
But as far as I know, millionaires only have to pay on maximum $21,790 of their income. The rest is free of deductibles. Unlimited!
This unbalances the equation and the payments in pension co. holdings, thereby stressing recipients by limiting them to a small annual allowance on retirement.
Yes private investors may do better that private pensions In Investing their funds, but the answer lies somewhere in the middle.
Government offers to help us and everyone is complaining?
What happens after the year-end? Is the problem of high fuel prices going away after the year-end? The government needs to outline a plan to deal with high fuel prices after the year-end.
Invade Russia!
Really, how is CIG supposed to solve global petrochemical trade imbalances?
I’m sure glad the Premier knows what the price of diesel will be in three months. I feel better now.
How about just raising the minimum wage to $15 per hour then Government won’t have to subsidise anyone in Cayman Islands?
Enjoy your $12 Whopper.
No problem. If something is too expensive while paying a fair/living wage then it’s too expensive and has to be cut out. And if that means no more fast food – or whatever – then so be it. Fair is fair. Yes, even if that means that some jobs have to be cut from the economy because fast food (to stick with the whopper example) is actually an uneconomical business. If CIG (US Gov, etc.) were giving Burger King cash in order to keep the price of the whopper down we’d all be decrying those government subsidies. But when its other people paying the cost we don’t mind. Imagine if the fast food worker got paid an extra $5 per hour but then got taxed $5 per hour to pay for said BK subsidy we’d all be on that picket line saying it was unfair. But hide the tax/subsidy through substandard pay, living conditions, whatever, and we’re OK with it? No. Fair is fair. And they deserve a fair day’s pay for the fair day’s work they ae putting in.
5:50 pm, what would happen to old people that needs helpers and dont have much income money if the minimum wages was 15 p h.Think before engaging your mouth. Think man think.
5 :50 p m, you think the cost of living is high now, put the minimium wages to 15 p h then you will see the cost of living go double or more.
Replace your aging AC unit, if its over 10 years old, then its probably using 3-4 times the energy of new units
Drop duty on solar and renewable energy equipment, including storage batteries.
Create proper bike/electric scooter lanes into Town from WB to BT.
Duty has been reduced to zero on solar and renewable equipment.
I replaced my AC unit and bill went from ~400 to under 200.
and I replaced my ac unit and it made no difference. Are you offering a guarantee?
“The subsidy goes beyond CUC’s own relief programme, which was approved by OfReg and caps fuel factor costs at CI$0.20 per kWh. However, that is not a grant programme and the power supplier will recoup this reduction throughout 2023.”
So to confirm CUC have capped their fuel factor at $0.20 for now but will charge it all back in 2023 so in effect have just moved consumers payments to 2023 as if everyone magically has more money to afford it then. So CUC has taken $0 hit except for some interest on receiving their cash now vs in 2023. Got it.
Brac power and light company charges up to 26 + cents for fuel factor and the fuel are duty free there.
And charge it back to senior citizens who have had no assistance during the pandemic and still living on $1,000 per month
No you dont got it! CUC dont have to take their money and pay for your fuel bill then allow you to pay them back over twelve months at zero interest but that is what they are doing. Be thankful! Got it now?
They should offer duty waivers dependent upon the amount of solar that a development will include.
Instead of giving money to pay for electricity, why not just give discounts if solar is included. Will incentivise developers and gov won’t lose out much as they are just paying out amounts for electricity anyways.
We are basically on the equator as well, it’s crazy that with the amount of sustained sunshine we have they haven’t allowed for more solar development.
We, the captive consuming public, must pay either way for the lie that burning diesel is the only way to make power. CUC’s Board and shareholders must really wonder how far they can push beyond the sell-by date.
Wonderful. I’m sure all the SMB condo owners not living here, not contributing to the economy and not dealing with the higher cost of living nightmare here in Cayman will very much appreciate assistance from the public purse to keep their empty units fully running and air conditioned.
Does this also benefits the the expat professional who makes $15,000 a month?
when will the handouts end?
maybe governments should subsidise mortgage payments too and food bills?
why don’t people just learn to live within their means?
any government handout should be means tested. end of story
It’s times like these where we should realize that Cayman shouldn’t be relying so heavily on a utility using antiquated, expensive and dirty petrodiesel-powered electrical generation. CUC doesn’t care about us, the environment, or your utility bill woes. Think of how much biodiesel could be blended-in from Sargasm/algae/fryer oil, if they actually cared.
We need solar and wind power. Get ride of the cuc mafia fist holding us down.
Wait… there’s been an assistance program going on?…
Could’ve honestly fooled me.
Did Government get confirmation from CUC as when they purchased their fuel or are they just taking the word of CUC? It’s easy to say it was purchased when the cost of fuel was high.
Capping it at 2000 kwts is not helping everyone – you have houses that have several people in the household, which may cause the kwts to be higher, etc.
The energy and fuel cost are the highest on the bill. What is an energy cost and how does CUC figure that out?
They just have too many charges that the customer has to pay – CUC does not take on any expense on them self as a company.
People just need to be comfortable setting their AC a bit higher. I have a decent size house and my bill never goes over 300, my AC also never goes below 79.
No company that makes a profit “takes on any expense on them self as a company” – they all pass it on in the price of their goods and services. Just because you don’t see an “energy and fuel cost” on your Foster’s receipt or your bar tab doesn’t mean that it isn’t a part of your bill. The charges in your CUC bill are there to break your cost down show you some of what is being passed on more clearly (fuel, licensing cost, etc). All of the other overheads that aren’t listed (staff, consumables, equipment, insurance cost, etc) are recovered by the energy charge as, well as their profit.
If it were not broken down as it is now, the energy charge would simply be higher as they would all be bundled in there in order to recover the expenses and then you’d be asking for a breakdown of what is included in the energy charge and we would be right back to where we are now.
Could the cost be lower? Of course they could. Everyone knows the ridiculous amount of overtime that CUC pays its workers that purposely delay and or plan work until time and half or double time kicks in. They could pay lower bonuses to their already well compensated senior staff and pass that on as savings. They could stop gold plating (i.e. overspec-ing/adding unnecessary components) to their capital projects to artificially inflate their returns as the amount of profit they are allowed to make is tied to their level of capital investment.
But please do not compare well broken down bills with greed as they allow you to determine for yourself how greedy they (and the fuel companies) are. Want a trick? Take your “Govt. Fuel Duty” and divide it by $0.25 (the currently duty rate on their fuel) – that gives you how many gallons of diesel you are being charged for. Divide your “Fuel Cost” by that number you just calculated and you’ll see what price CUC paid for the fuel they are charging you for and go compare that to the open market the same day, 2 months prior (as CUC charges on a two-month lag basis).
Educate yourself and save for energy saving upgrades to your home.