OfReg blames CUC for stifling solar with low CORE rates
(CNS): The utility regulator has approved new rates and capacity brackets to increase the number of people on Grand Cayman taking up renewable energy generation options. OfReg said CUC’s Consumer Owned Renewable Energy (CORE) programme rates have stifled the adoption of green energy in Cayman and have done nothing to advance sustainability goals in the energy sector.
From 1 November, it is imposing a new rate of 21 cents per kilowatt hour for 7.5kW and below and 17.5 cents above 7.5kW up to 15kW.
The new rate is a significant increase for smaller producers, who currently receive 17.5 cents per kWh for up to 5kw and just 15 cents up to 10kw. However, CUC has stated that the increase in this rate has the potential to increase the cost of power for everyone.
In a press release, OfReg stated that following much deliberation on the status of the CORE programme and the more recent “lacklustre demand for CORE under the previous fee regime”, a decision was made to approve new rates aimed at increasing consumer uptake and participation in self-owned renewable energy generation options.
Officials stated that after reviewing the history of the former CORE programme, it was evident that the previous iteration did not create the incentives necessary to advance it or the country’s national energy generation and sustainability goals.
OfReg Interim CEO Sonji Myles said the regulator works to support the aims of the National Energy Policy.
“It must regularly consider how to enhance CORE feed-in-tariff programmes, exercise our statutory power to authorise CUC to purchase renewable energy from consumers, encourage the promotion, development and use of renewable… or alternate forms of energy by consumers and champion the need to permit, promote and incentivise the use of renewable and alternative forms of energy by consumers, so as to reduce the load on any Transmission and Distribution system and demand for fossil fuel,” he added.
OFReg said the CORE programme had disincentivized the uptake of renewables, which have seen a decline in demand in recent years despite the increasing cost of fossil fuel energy generation. This left around 4.4MW of unused renewable/alternative energy capacity available for the taking.
OfReg Chair Samuel Jackson said there should be viable options for people to participate in renewable energy generation for themselves and reduce their electricity bills. “Equally important, moving to renewable forms of energy generation reduces the demand on fossil fuels, which in turn moves us closer to a more sustainable and greener Cayman.”
Responding to the change, CUC said it supports the development of renewable energy programmes that benefit all electric consumers on Grand Cayman.
“We learned about these new CORE rates yesterday, and based on our initial review, the OfReg-approved rates appear to be higher than current fuel costs and will, therefore, potentially increase costs to consumers as CORE energy will now be higher than the cost of fuel that it displaces,” a CUC spokesperson said.
“In all of our proposals to OfReg, CUC has always strived to lower the cost of energy. The current CORE and DER programmes, which reduce energy costs for all consumers, have been open for subscription since July 2023, and several hundred customers have already subscribed to the programmes. We look forward to discussing this new rate with OfReg and continuing to pursue low-cost renewable energy programs that benefit all customers.”
CUC has previously said that it believes its CORE rates are fair and that it would not increase the rates it pays those customers despite the pressure from the Cayman Renewable Energy Association, and it would not “support paying inflated prices for energy” from rooftop producers as it would have to pass the cost on to regular customers.
CUC has also argued that the very small domestic solar market is not being constrained by its approach to CORE or its rates but by grid stability. It has also said that the estimated cost of electricity from a utility-scale solar plant is in the 10 to 11 cents range per kWh, which is why it continues to advocate for more utility-scale renewable energy.
Up until now OfReg had not challenged CUC’s approach.
However, the take-up of the latest release of access to the grid has been poor. Despite the ambitious green energy targets set out in the new National Energy Policy, the needle has barely moved in years on green energy generation, which remains about 3% of Cayman’s entire electricity generation.
Meanwhile, officials at OfReg said the new CORE rates and capacity brackets apply to all the available and unused capacity, estimated to be 4.4MW. The new rates and brackets will not apply to any existing programme agreements, including those under extension, or subject to any request for further extension made before the public announcement of the 2024 CORE-Renew Programme.
The new rates become effective on 1 November 2024. The CORE-Renew Programme will be applied on a trial basis and re-evaluated at least twelve months after its implementation date.
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Category: Business, Energy, Science & Nature, utilities
This is some communistic crap!
As a free market we should be able to install any form of renewable energy within reason.
CIG should educate the people on harnessing renewable or solar energy.
Suppliers are selling solar as only grid tied, they are not telling you that you really need batteries or energy storage to be independent.
They are not telling you that if you are grid tied and power goes down, you also loose power, you also get charged for solar power which you generate.
Therefore the supplier makes a massive profit, the utility company makes additional revenue plus getting free energy from your roof top solar at 0.17c per kWh and sell it back to you at 0.31c per kWh.
The only way around this is to get batteries, which do not need to be Tesla branded batteries. With knowledge an individual can purchase a 10KWh/51.2v 200ah battery for US1650.
This is where a consumer protection agency or CIG could do a better job educating the population.
One must know, in order to teach.
UCCI TVET program
TVET 052 1 0.00 Solar Photovoltaic Systems InstalleTVET 052 1
Exactly!
Who the hell is CUC or OfReg to dictate what we do with SOLAR energy. Maybe if CUC had say or stake in persons installing solar energy there would be many more people interested in the “…sustainable, greener Cayman….” these dimwits allude to be working towards.
I don’t normally comment, but I’m seeing way too many people making incredibly ignorant comments on here to just let this one go.
I was one of the relatively early subscribers to the CORE programme, so I receive 28 cents per kWh that I produce. Whoo hoo! That’s great for me, right! I’m going to be rich. Wrong…
First of all, CUC limited the size of the system that I could put on my home to ensure that I wouldn’t produce more than I would be using (the only way I could possibly get around that would be to pretty much shut everything in my house down, which isn’t going to happen).
Secondly, they keep spouting all of this bullsh*t about how they have to pay more for the electricity that they buy from the CORE producers, so they need to pass that cost on to everyone else. Hmmm. Let me explain why that is bullsh*t:
From my most recent bill, which covered September 2024
Energy Charge kWh – $0.1321
Govt. Fuel Duty – $0.013974
Fuel Cost – $0.168603
Renewable Energy kWh – $0.005395
This all adds up to $0.320072 per kWh
Then there is a Lic. & Reg. Fees kWh – $0.0155 (for everything over 1,000 kWh), so if you add that in, you have $0.335572 per every kWh over 1,000
Plus there is a fixed Facilities Charge of $13.12, which would need to be spread out over however many kWh you used.
Now here is the kicker that I don’t think most people understand. My solar system (repeat, MINE; I paid for it, not CUC) is technically a standalone power plant that is generating electricity and then I’m selling it to CUC for $0.28 per kWh.
However, CUC then turns around and sells it back to me for $0.320072 per kWh for the first 1,000 kWh, then $0.335572 per kWh for everything over 1,000. Then charges me a $13.12 Facilities Charge.
So it shouldn’t take a rocket scientist to figure out that I’m actually LOSING money by selling MY electricity to CUC. I’d be better off just running my house on it directly rather than selling it to them. I’d basically have to produce about 20% more electricity that I use to just break even (which if you recall, I stated previously that CUC wouldn’t let me install a system that large). And keep in mind that they didn’t have to do anything to produce that electricity, yet charged me for it and made a big profit!
So if CUC is stating that they need to raise rates for everyone else because of my CORE connected solar system, they are incredibly full of BULLSH*T! They spent nothing, and yet still make a profit off of me.
What really annoys me is that they charged me for fuel usage that was never even used! How come no one is complaining about that! I bet they are pocketing millions off the CORE producers on just the fuel charges that never actually went to buying fuel.
As I said before, my solar system is mine. CUC doesn’t reimburse me for any maintenance or repairs (cleaning the panels, replacing components that fail, etc.).
The simple fact that I was willing (and able, even though I totally understand that some people aren’t) to invest in my own solar system has helped CUC not have to purchase another generator (or invest in any other means of power production, including utility scale solar). I guarantee you that when they do have to invest in more power generation, CUC will most definitely pass those costs on to everyone.
So why all the hate?! Those that are installing small solar systems are technically saving everyone money.
The only ones that should be upset are CUC and their shareholders.
Solar is 7 times more expensive than natural gas.
https://www.realclearenergy.org/articles/2024/10/07/solar_shame_the_true_cost_of_solar_power_1063523.html
Diesel is about double the price of natural gas or coal, so solar would be three times as expensive as diesel.
https://extension.okstate.edu/fact-sheets/true-cost-of-energy-comparisons-apples-to-apples.html
The first article also illustrates how utility scale solar is a “waste of money”
There’s more to this situation than just monetary cost (although that’s what most people focus on).
There’s also the situation that human’s are taking carbon that has been locked in the Earth’s crust and releasing it into the atmosphere, that contrary to what all of the Flat-Earther’s think, is causing a blanket-like effect that is trapping in heat and causing global warming.
We need to stop burning fossil fuels ASAP, whether the alternatives cost more money or not.
Dear CUC is full of BULLSH*T!I hear you loud and clear!!
1. The sun is free.
2. We purchase and install the equipment.
3. CUC should have Zero, Zilch, Nada, None, Diddly Squat to do with the energy OUR equipment generates.
The Cayman Islands is the only place in the entire world where an electrical company believes it has the right to charge its people for the sun God put in the sky.
Why is CUC allowed to clear credits to your account at the end of the year? That is straight up robbery. If I have $100 credit on my CUC account that isn’t used by the end of the year, why does it not roll over to the next year? If I didn’t pay my bill from June this year, will I start from Zero on Jan 1, 2025, and have my debt reset?
I understand that unlimited energy credits affect their revenue, but a simple buy-back program could be the solution. At the end of each year offer to buy back credits at a rate lower than retail, then sold back to consumers at retail. As it currently stands, CUC gets this excess energy for FREE and sells it back to consumers at retail prices. IMHO this translates to robbery and CIG should not allow it.
What is the actual number, as it relates to forcefully forfeited energy credits, that CUC end up with at the end of each year? Should this not be taken into account when they want to raise their base rates? Seem to me CUC have it easy compared to other companies when it comes to making profits, which in turn make the CEO seem like a genius.
The credits actually end up going back into the renewable energy charge line item, which is described in the CORE agreement, so it lowers the cost of renewable energy for other consumers. Since CORE is a pass-through for CUC, they neither profit, nor lose, from any aspect of the program.
All I need to know is that if I purchase my Solar AC unit.
Install it in my bedroom and mount my three or four panels on the roof with LIPO4 batteries and not connect to CUC, will I hear from Offreg, planning or any other industry controlling body?
You certainly will. As you need approval from CUC to mount panels on your roof.
Nonsense. Don’t spread foolishness.
Then please post the facts….
The installation of solar panels or other structures falls under the authority of the Department of Planning and Building Control.
Approval to connect those panels to the electricity grid does fall under the the authority of CUC, subject to the rules and regulations that were, at various points in time, reviewed and approved by OfReg/ERA/CIG.
Bs CUC may control planning but they are certainly not planning.
This is an Island blessed by sun and near constant wind, it could easily power itself from these sources with oil as a back up, but it doesn’t. To understand why, consider two things, first the link between politicians and CUC, then the two charging structures, how they charge you, and how they are rewarded by government. Those two will explain the lack of incentive for CUC to allow solar or wind power, and the lack of political will to do the sensible thing!
From the very large amount of commentary on this article and on social media from James Whittaker supporting this new program despite the significant concerns being raised by other commenters, it is very clear that he and his company are the primary benefactors of this new program. I guess he can now sell his solar panels for a little more and make some more money.
Let me get my little calculator going. If the program is for 4.4MW that’s 4.4 million watts and rooftop solar panels cost $2-3 per watt to install, that is over $10 million in business for the roof top industry. I don’t know what margin in the solar business is, but lets say it’s a modest 20%.
Looks like Mr. Whittaker just got a big piece of $2 million pie handed to him. Brilliant!!
Congrats James! Any other cost increasing programs coming up for the public to pay for you?
Anyone else want to ask the Ombudsman to look into this?
How did James’ sales team know about this rate change weeks before the decision was made public? Something’s fishy with OfReg.
All CREA member companies were aware OfReg was considering CORE changes, nobody knew the details until OfReg’s decision was announced. For those persons to know in greater detail what’s going on in the solar industry CREA is free for all to join. http://www.renewablecayman.com
Your company’s email, which was sent two weeks before this announcement, stated that CORE rates will change this month. Explain.
It is literally explained in the comment you replied to; they knew changes were coming, but were not aware of the details of said changes.
If you think that math is correct I would highly encourage you to have invested in the solar space in Cayman a long time ago. The reality is if not for the efforts of a dedicated few people there would be no solar companies left in Cayman nor any solar options for consumers given the industry disruptions over the last half decade lead by CUC, which have only now started to shift. As I said, if Im wrong give it a go, that’s the beauty of competition and free markets.
I’ve always found it strange that CUC gets to determine the rate at which I have to sell my power I generated with my solar panels. Seems like a wide open conflict of interest.
Also, if we have a goal of using less fossil fuels, would it not be more effective to use solar to power homes and businesses instead of using fossil fuels and crediting solar users with a pittance for their troubles?
CUC doesn’t determine this rate, OfReg does.
I’ve always found it strange that CUC gets to determine the rate at which I have to sell my power I generated with my solar panels. Seems like a wide open conflict of interest.
It looks more to me like CUC is only saying this is how much we are prepared to pay for your solar power, based on the fact that they have to then re-sell it to their customers. You could always sell it to someone else at a higher price.
Wrong! CUC has a monopoly on distribution. You cannot distribute electricity without a license.
Headline just a talking pout its down to “What you going do about it”
Sound good news from Ofreg, Cayman desperately needs to produce its own renewable energy during crisis.
And while CUC looks at gas Jam is looking st small reactors.
Jam is right to do so. We should too. The new technology is safe and inexpensive. It would substantially reduce the cost of living.
This is a good decision by OfReg and some of these anonymous posters clearly have ties to a certain utility.
There is LOT more going on that the public don’t get to see at the surface…. here’s a small glimpse behind the curtain.
CUC per usual is relying on half truths and scare tactics to influence public opinion against their own best interests, namely that rooftop solar (solar on roofs, parking lots, etc) will increases costs to consumers.
This is a lie in so far as CUC is the one creating the exact environment where that reality exists. Small solar systems require higher rates to have the same investment ROI as larger systems with much lower rates. It’s simple economies of scale.
CUC understands this concept of economies of scale all too well, it’s a core part of their die hard push for a primary focus on “utility scale” solar.
They intentionally try to fool the public into thinking they do so because of power rates when the truth is they do so because utility scale solar provides CUC with the best opportunity to extend their monopoly control over energy generation forever by owning and controlling most of those utility scale power plants and selling future generations energy at prices and in a manner they can dictate. What they don’t want is 1000’s of locals producing a majority of their own power and relying ‘less’ on CUC as this erodes their control and profit.
The unspoken truth about rooftop solar vs utility scale solar is that both can be done at an “average cost less than the cost of fuel” which means all consumers save money it does NOT increase rates. The way you accomplish that is that you make sure that rooftop solar systems can be done “large and small” with smaller systems having higher rates and larger systems having much lower rates, the average of all those rates being under the cost of diesel and thus there is a decrease in consumer costs.
“The problem” is that CUC is the one blocking “large” rooftop solar systems which will have much lower rates and thus reducing the costs to consumers. Why? Because CUC doesn’t want “YOU” producing a large amount of your own power as a homeowner or business, THEY want to provide you with power to keep their monopoly control in fact.
So the very people who complain that rooftop solar is too expensive (CUC) are the exact same people who are blocking the ability for it to be much cheaper. Why? Because it serves their ultimate goal of not allowing consumers to reduce their reliance on cuc and ensure CUC is able to monopolize energy generation and profits for our children and grandchildren and they have done for us and our parents and grand parents.
The government, OfReg, CREA and others are fighting against this and pushing for consumers to be able to produce and consume more of your own energy and rely less on CUC and thus greatly reduce your energy costs and increase your resiliency (producing your own power during hurricanes, etc).
CUC is going to absolutely try to scare you and your family to death the entire way screaming that doing so will increase your costs. It’s pure desperation by a private Canadian owned company who sends the vast majority of its profits overseas trying to protect it’s monopoly control over a small island who is embracing a technology (renewable energy) that can democratize energy instead of allow them to simply monopolize it.
Monopolies do not give up their monopolies willingly, you have to take it from them. CUC has no legal monopoly over energy generation in this country by they do exercise monopoly control over it via their legal monopoly of the grid and denying you a connection to it.
CUC’s business model whose profits are based upon your ever increasing electric bills if fundamentally antithetical to the goals and best interests of consumers who want to see those bills cut drastically… 50,60,70% or more. The business model is flawed and needs to change but they have a defacto monopoly to the year 2048 unless they are forced to changed by consumers, government and OfReg.
The simply reality is this… do not trust anything CUC tells you when doing so means almost a sole reliance on them for your future energy needs; energy you could help produce on your own (if they weren’t also blocking consumer financing which they are as well and that’s another issue of importance).
What we want as a country and as consumers is the freedom to produce some of our own energy, lots of competition in the marketplace to provide those solutions and a largely equal balance of rooftop solar and utility scale solar (which requires cutting down 1000’s of acres of land if primarily focused on) in the end. Not simply one of the other as CUC would prefer.
The ‘current’ Ofreg leadership is trying to fight for your best interests as consumers, don’t be fooled by the utility scare tactics.
Do not be surprised either if a certain utility tries to ensure the next group of politicians in 2025 gets ride of these ‘troublemakers’ at OfReg and set things back the way they used to be when they had all the influence and control.
Young Caymanian here, my two cents on this issue…
It’s interesting to see such a strong push for rooftop solar, especially from someone who owns a solar company and would financially benefit from policies that favor smaller-scale installations. While rooftop solar does offer certain benefits, like individual energy independence, it’s important to acknowledge that your advocacy might not be purely for the public good —it also aligns with your business interests…but with that being said…
Utility-scale solar, on the other hand, can provide energy at a lower cost per unit due to economies of scale, which benefits ALL consumers, not just those who can afford to install solar panels… A truly consumer-focused energy future should consider both approaches, balancing rooftop solar with utility-scale installations to ensure affordable, reliable energy for everyone. :/
So while it’s good to have industry voices like yours at the table, we should also consider that the best path forward may not always line up with the business interests of solar providers…
If OfReg and CUC can work to foster a balance—where consumers have choices, fair rates, and strong protections—then both models might coexist to benefit Caymanians. Cayman needs a balanced approach that benefits everyone, not just those with a vested interest in one solution over another.
Thanks for the comments young Caymanian. Couple of points to note, I was advocating for solar and installing solar on my homes many years before I ever got involved in the solar business itself. My motivation for doing so go beyond money, if that was my primary motivator I would have continued doing what I was already doing prior in finance. The reality is change is badly needed in the energy landscape and cost of living here and and only a few of us have been willing to fight for it against well funded, highly influential and long entrenched vested interests. Im fully comfortable with the criticism of advocating for renewables and being in the sector, criticism comes with the territory so if you can’t handle it this is the wring space for you. That said it’s my position in that regard is no different than any other sector and advocacy groups… bankers advocate for banking, lawyers advocate for legal services, hotels advocate for tourism, etc. etc. etc. I however focus on the substance of the issues and what’s best for Cayman and future generations, so the conflicts of interest thing is an easy go-to for some folks but it doesn’t deal with the heart of the matter. To that end what I and CREA advocate for is a future where our energy generation is coming from clean sources, where consumers have lots of choice, where there is lots of competition and where CUC utilises all those generation resources to remain a profitable company without being monopolist who controls the future and bars competitors and consumers from utilising the free and abundant sunshine that hits their roofs. Recommend you join CREA http://www.renewablecayman.com and learn more. We’re always looking for folks who want to help affect positive change and you dont have to be I the solar industry or a solar expert to do so.
This is a lie in so far as CUC is the one creating the exact environment where that reality exists. Small solar systems require higher rates to have the same investment ROI as larger systems with much lower rates. It’s simple economies of scale.
XXX
I do not expect the water company to purchase excess water from my cistern after heavy rains, nor do I expect the grocery stores to compulsory purchase my excess mango, banana, cassava etc. crop whenever I have a good season. You just seem to think that the purpose of CUC is to provide you with free banking services, and to the detriment of the average person who cannot afford to install massive solar systems that generate power in excess of ten times their monthly usage.
And yes, I happen to know a lot of people who work at CUC, as does anyone who has every lived here for years.
Anyone who can afford to install 15Kw system on their roof can afford to go completely off grid. The only reason for not doing it is because they are collecting profits from CUC, which can only come from the pockets of the rest of their customers.
Incorrect, the only reason people are not off-grid is because of CUC. They control rooftop solar installation and must be grid-tied. CUC does not want us off-grid as it will lower our dependence on them. CUC also controls distribution, which makes it impossible for your neighbor who is off-grid to feed it directly to you without it passing through CUC who will add their margin. Please direct your anger to the real culprit.
Also, when less people are dependent on CUC due to off-grid solar, the people who still depend on them, will have higher bills as the number of consumers would decrease.
That’s a flawed analogy.
The proper anology would be the water company trying forcing you to not be able to collect the rainwater that falls on your roof so that you need to rely less on buying water from them and instead be forced to ONLY buy water from them. Thats a far more accurate analogy related to CUC and rooftop solar and correlated to water.
No I don’t think CUC provides any free service, I’m pretty sure every customer knows that, however not needing CUC ‘as much’ (and thus spending less on your monthly bill) is not akin to getting anything for free, it just means you need a utility whose business model is not predicated on a profit incentive by which they do better as our cuc energy usage and bills go up. Something CUC does not want to see changed but just happen for the betterment of the country.
Yes I also know lots of people at CUC, I have family and friends who work there. Doesn’t negate the facts as stated. CUCs actions here in Cauman are also typical of regional monopoly utility companies that are owned by Fortis Inc, who ultimately pulls the strings.
Theres quite a big difference in cost and complexity between going off grid and having a 15Kw grid connected system. Just go out and get some quotes and see for yourself
Hi James, can you actually walk through how having higher rates will ultimately save people money? Because, per usual, you’ve typed a lot without saying much of anything substantive. I get that this is where your business makes money, so of course its the best way forward, but for those of us who really just want to pay lower bills and not invest 10s of thousands of dollars to produce any solar, how does raising rates paid to others help me do that?
It does it through incentivizing investment in power sources for which (a) CUC does not need to charge you for the construction of new generating capacity, and (b) CUC can purchase and resell power at a mandated lower price than the actual market price.
You’re welcome.
(a) solar barely contributes to requirements for generating capacity because the biggest demand for electricity is not during the middle of the day, so those generators are likely to be needed anyway
(a-2) unless you buy batteries, but who will pay for that?
(b) if the CORE rates are higher than the alternative cost to generate (either from other solar or from diesel), then CUC is buying and reselling at a higher price than actual market price
Try again.
Rooftop solar/Distributed generation doesn’t raise rates, as I said prior it lower rates when scaled and that’s exactly what’s happening as we speak and what the national energy policy calls for.
if you read much of what I’ve posted you’d already understand why. As for it being my business, I suspect I know who this post comes from so perhaps that’s an ironic statement and why you need to post anonymously.
That aside your premise is simply false but I understand fully why you try to make it. In the end all solar in Cayman (DG included) will not only lower costs but also increase resilience and provide a net economic benefit to the country (jobs, etc) vastly above any ‘costs’. Some persons/monopolies will no doubt kick and scream until the bitter end but that will be the inevitable end result regardless.
CUC is again using scare tactics. As things stand the power produced by solar panels on rooftops around the Island are just injected into the grid and CUC just redistributes that power to customers all the while doing a profit!
The renewable fee customers are paying for is applied on EVERY single power bills at the rate of power consumption from the grid , so there actually isn’t any subsidy of any sort.
Our family has been long term solar energy users for almost a decade. We have been part of the Core program since phase 2 and on top of that have installed a solar plus battery system to feed the installations inside the home that could have become completely off grid (our pool pump, our first solar project cut off our power bill by 20 percent as soon as there sun was up it was churning along)
We charge our electric cars from the CUC Core installation which kept our power bills neutral and even negative when away from home cumulating CORE credit for the months to come .
Let me also remind that every year your unused CORE credit gets reset further fattening CUC’s profits to its shareholders and stakeholders
As a monopoly let me be clear that CUC is our local Standard Oil as to the protection of its shareholders at the expense of its customers especially the most vulnerable ones , our local banks proposing loans for rooftop solar installations add a new layer of complexity to any solar project at only a pirate’s parrot would love! With financing for solar projects here considered as a personal loans with rates starting at 8.50 percent! (Pushing back your ROI into the tall grass for 15-20 years in one swell swoop!)
OfReg was for many years the strong arm of CUC and the situation changed dramatically to a more conventional approach , don’t get me wrong there still is a LOT that remain to be addressed (StarLink being one of them)
Cayman is an energy poor country by its energy policies and if we were to measure our wealth in cost of access to electricity and renewables it would be among the poorest countries.
Source: https://islands.irena.org/-/media/Files/IRENA/Agency/Statistics/Statistical_Profiles/Central-America-and-the-Caribbean/Cayman-Islands_Central-America-and-the-Caribbean_RE_SP.pdf
Isn’t it comical for an island where the sun shines over 300 days a year ? It is ridiculous to say the least !
Our MLAs and CIG have close to no understanding of how serious the situation can become in case of an oil crisis of the like of the 1970’s and what it would imply in terms of revenue generation for the financial services sector! Our reliance on fossil sources of energy is a very serious problem and the hurdles in place to transition are making the situation worse.
Remember when fuel costs went over 20¢ and government panicked about the cost to consumers and instituted a subsidy to provide temporary relief for residents?
And now OfReg is putting up the CORE rate so we can pay 21¢ for solar on the rooftops of the wealthy?
Who benefits, any why are these decisions being made?
Broad daylight robbery
If CUC can’t deliver within the very wide and loose parameters of its generous exclusive license, they forfeit it. Under those circumstances, it can and should be canceled by regulators, and a competitive RFP issued by policy makers.
I got $0.28 years ago and was annoyed it wasn’t index linked. This is going backwards not forwards. V sad for an island that is more exposed to fossil fuel spew than anywhere else in the world .
Why would it be indexed linked? Did your system that you installed at a single, fixed price point require any consideration of future commodity pricing over your 25-year contract? Greedy.
Thanks Juliana, Jay and Sammy for raising all of our electricity bills AGAIN.
And this time just before Christmas. What a lump of coal from three lumps of sh!t
Remember, them same three allowed CUC to raise electricity rates in July 2024 already, now this is another increase on our light bills thanks to these three clowns
How about we send all our CUC bills to North Side and Cayman Brac East constituency office for them to pay since they allowed this increase to happen
Please can OfReg (or Cabinet) update everyone in Grand Cayman as to what is happening with competitively-bid industrial solar?
Large amounts of electricity at 11 cents per kWh (industrial-scale solar) make a lot more sense than small amounts at 21 cents (residential roof top).
The cost of energy contributes significantly to the cost of living. We need to weigh up very carefully the cost-benefit of any increases to that energy cost.
At 17.5 to 21 cents per kWh, CORE roof-top solar will be 60% to 90% more expensive than industrial-scale solar at 11 cents.
Roof top solar is more geographically distributed across the island, which could reduce the risk of say a tornado destroying a single industrial-scale site.
But, the higher probability event is a major hurricane that damages many of the roof-top solar installations, and that these take a lot longer to fix.
Both industrial-scale and residential solar require the capacity of the Transmission and Distribution (“T&D”) system to be maintained
The implication that residential solar will help lighten the load on the T&D infrastructure seems flawed. This would only be the case if these small generators were to go entirely ‘off-grid’, with full battery and generator back-up. Otherwise, the T&D capacity will always need to be maintained to provide them with backup, unless we are willing to live with rolling brown-outs as-and-when residential installations are at reduced capacity.
Those who seem to benefit from OfReg’s proposal appear to be small and mid-sized generators who can afford the solar panel investment, developers who can claim reduced energy costs for their new developments, and residential solar installers.
Those who don’t benefit appears to be everyone else, most likely the majority.
Don’t let CUC fool you.
Look at your September CUC bills:
Energy Charge(the base rate) 13.21cents per kWh
Govt. Fuel Duty 1.3974cents per kWh
Fuel Cost 16.8603cents per kWh
Total base rate plus fuel is 31.4677cents per kWh
The base rate is the cost of the infrastructure and operations. All the CORE replaces is the Fuel Cost and Govt. Fuel Duty.
So in this case, the new CORE of 17.5-21 cents would replace some of the 18.2577 cents for fuel. Historically, the Fuel Costs have been around 15.5 cents, so these new rates are going to likely increase total bills by a small amount.
Previously, the CORE rates of 15-17.5 cents were much closer to the historical fuel rate, so we got to benefit from greener energy without increasing our costs.
So from November 1st, I, as a non solar producer, will now pay more to the new solar producers.
Thanks OfReg for increasing my power bill for no real benefit.
You’d rather pay more to the oil company that sells them diesel instead?
It’s really shocking that people don’t understand how this works.
CUC doesn’t harvest energy out of thin air for free. They pay for the inputs – the fuel, labor and equipment – to generate electricity at their base cost. That is then sold to you at a profit above their base cost.
It makes NO difference to you whether they can generate power at a cost of $x per kWh and sell it to you, or buy that power for $x per kWh and sell it to you.
If I started growing carrots, and Foster’s buys my carrots to sell along with their imported carrots, and then you buy carrots from Foster’s, what do you care where Foster’s bought their carrots?
Do you see the population growing? Yes?
Do you see the power plant getting any larger?
Do you want to subsidize the foreign company that is going to sell the next generator they need for the increased capacity?
I can’t believe people don’t understand this.
If Foster’s buys your carrots at $3/lb, and buys imported carrots at $1/lb, I think I might care where Foster’s buys their carrots.
If you could sell your carrots at $1.10/lb, I might pay that premium and feel a little better about avoiding the shipping and supply chain, but there’s a limit to that premium (assuming the quality of carrots is indistinguishable).
But that’s not how it works. CUC is paying LESS for both the power and the new generating capacity of private solar than it would cost them to add that capacity and generate it themselves.
You left out the part about what price is Fosters’s is SELLING all the carrots.
No, not really. All that is happening is that the generators already in place run less (but still exist) and CUC uses less diesel fuel. If the price of diesel is lower than CORE, that costs us money. If the price of diesel is higher than CORE, it saves us money.
CUC sells the carrots, in this analogy, at the same price they buy it for. It’s a requirement in their License.
“All that is happening is that the generators already in place run less (but still exist) and CUC uses less diesel fuel.”
Demand is increasing. It is not constant. Grand Cayman can only continue so long on its current installed base generating capacity.
One of the ways that grid-tied solar is a convenient way for CUC to obtain additional supply capacity with essentially zero capital investment is that solar generation capacity ALSO matches peak demand.
But your comment assumes that there is a constant demand for electricity. There isn’t, and the added capacity has to come from somewhere, and someone needs to pay for it.
All very true about demand increasing, except that solar generation does not match peak demand.
Solar generation is highest from 12-2pm. Peak demand is typically 5-8pm. This mismatch is why solar doesn’t displace capacity, just energy. You’ll need batteries for that.
Utterly ridiculous, this will mean higher bills for us all just so those who can afford it can put solar on their roofs.
Fact 1: The only reason that every consumer in Cayman does not already have access to 100% ($0 down/no collateral needed) financing for solar energy systems is that for years now CUC has been blocking consumer solar financing and failing to enact community solar programs (for people who are renters and don’t have a viable roof).
Fact 2: Rooftop solar can be done at an average costs below that of diesel as long as consumers are allowed to installs large and small systems; the larger ones having much lower rates than the small ones. The average cost of all that solar energy then being below the cost of fuel means that there is a “decrease” in costs to consumers (not to mention millions of dollars flowing into the local economy from the green jobs created by a growing and competitive solar industry).
The roadblock? CUC has been blocking the deployment of large rooftop solar systems (and financing) exactly because they want to keep the systems small and the rates higher then they need to be so they can mislead the public with claims that it’s “too expensive” and what you need to do is just forget about producing much of your own solar energy and let us primarily focus on building and owning the solar farms so you can continue rely on us for all your energy for future generations.
Fact 1: Solar financing is available from most retail banks on island and has been for years. James wants his business to be able to offer you the product they already sell you, plus interest by leasing it. Go see how that’s working out in the US when the installers become the predatory lenders.
Fact 2: This is another way of saying that larger systems will lower your costs, but smaller systems won’t. If you put in enough larger systems, the “average” cost will go down when you mix the two together. It won’t change that the larger system is the only reason the cost is going down.
It’s not hard to spot the CUC influence in that post even the half truths.
1. Viable solar financing is not to most Caymanians because the basis of that lending is short term, collateralised lending. Which means most Caymanians cannot afford it. If they could they already would. What is needed is a way to get long term, fixed interest and $0 down lending in order for financing to be viable for most locals. That’s the other half of that half truth you didnt bother to mention and is the very thing that will put the benefits of solar in the hands of everyone. Adding the “predatory lenders” scare tactic is such a dead identity giveaway btw.
2. This time you mixed in some half truth while also misleading, bravo. The fact remains that yes economies of scale matter in reducing costs (on that we agree and always have), however the CUC ‘hypocrisy’ is they only accept this principle when it benefits their strategy and they ignore it when it doesnt. If rooftop solar had more scale the average rates would be lower than the cost of fuel and CUC would lose their “its raising prices” misleading (but highly coveted) claim, which is a key reason why CUC has done everything that can to prevent that scale and proliferation of rooftop solar. The irony is this principle is no different for utility scale renewables, a 50MW system will have a lower rate than 20MW system and much lower than the existing 5MW solar farm in Bodden town…..the average rate of all those various scaled utility systems will determine the overall costs of “utility scale solar” to the country.
The simple fact is rooftop solar and utility scale solar can be done across an entire range of system sizes below the cost of fossil fuels and (critically important to understand) both of them have pros/cons which is why a balance of BOTH is ideal. Instead CUC hides behind the notion that utility scale solar’s pros are all that really matter and everything else should not be supported; but they only do so because THAT is the method by which their end goal to attain a defacto monopoly over (clean) energy generation can be achieved.
What results is these half truths and misleading statements around rooftop solar which is merely smokescreen and scare tactics to protect their monopoly control.
Ps- Notice when I post Im not scared to put my name behind. You should guys try it for a change.
Not CUC, but I get that everyone that isn’t in your court must be associated with the boogeyman.
1. Green financing available from the banks can be incorporated into existing mortgages, with low transactional impediment. That clearly doesn’t help those without mortgages, but if you’re a homeowner without a mortgage, it’s easy to access home equity if you’re cash-poor. As to the comment on predatory lending, it’s a well-documented issue where this financing model is most common (America) – see https://www.responsiblelending.org/sites/default/files/nodes/files/research-publication/crl-shady-side-solar-financing-jul2024.pdf for example.
2. Using an average is a convenient way to claim that the overall product (solar) is lowering costs when only some of it actually is. Talk about misleading. For the avoidance of doubt, all I care about when I have to pay my CUC bill every month is that it’s as low as it can be. If you were advocating to lower my electricity costs, you would have my full support. But trying to give this crap about up is down, inside is out, the rates going up means that costs will go down is absolute garbage.
1. Now that you’ve run away from the solar loan premise presumably because I’ve pointed out the obvious issues with short term collateralized lending, please be aware that most Caymanians do not have the ability to incorporate more borrowing into their mortgages either.
Once again if this was untrue you would see lots more solar energy and none comparing about being able to access it. Using the utility’s billing systems allows for multiple ways to get solar and savings in the hands of customers with $0 down.
Your only real argument here seems to be basically “nah, financing is already available for everyone so better financing options are not necessary”. Sorry but that’s not factual nor reality for locals who want solar but cannot afford it.
2. Hate to break it to you, using cost averages is how just energy works.
How do you think CUC makes their own claims about the cost of fuel (upon which the claims of increasing rates and subsidy) is based?
Cayman has a 5Mw solar farm that already sells energy today at around 15c today; when we have more solar farms of different sizes (Ala 20Mws at 10c, 50Mws at 8c, etc) how do you think we determine “what is the cost to the country from utility scale solar?” You average those system sizes and rates.
Rooftop solar is no different, you will have systems large and small with rates higher to lower and the answer to “what does rooftop solar cost Cayman” can only then be determined by an average of all those system sizes and rates.
BUT… If your a utility hell bent killing all solar you don’t own/control and thus intent on scaring people into thinking rooftop solar will cause their bills to go up and not down (and some people have fallen for) you certainly don’t want to see the rooftop systems get large with much cheaper rates because then it erodes your nonsense claim about increasing costs entirely because it’s lowering their costs.
As for rates going up but costs going down being garbage; no it’s not but you actually have to know a bit about how energy works.
The rate paid for solar going up does not inherently mean consumer rates go up; THAT entirely depends on how high you raise those average rates…. if that rate is less than the cost of the fuel there is no increase in consumer cost because you were already pay more for the fuel it’s offsetting.
In simplistic terms if the core rate was 1c and then increased to 2c but the cost of fuel is 3c you’ve saved consumers 1c despite the core rate increasing by 1c.
That again is simplistic but done purely to illustrate the point of why your statement is incorrect and lack context.
If you want to I can happily get into the average cost of fuel today and the expected escalation rates of oil (which dictates future fuel costs) over time time as per OPEC, IEA, etc. projections, all of which shows todays costs rising steadily upward (either moderately or dramatically but certainly not going down in the long term) all while solar costs and rates will decline over time as the costs of solar gets cheaper.
There is thus no subsidy in the long term with these solar rates and thus no increase in consumer costs despite all the utility scale tactics.
You add in the removal of CUC’s blocking of larger rooftop solar systems (at much cheaper rates) and not only do you not increase consumer costs youll have substantial decreases in consumer costs all while gaining the added benefits (economic, social and environmental) which rooftop solar provides.
Hope that helps.
So, the guys that compete against small scale renewables were underpaying for it. Gotcha!
In other news, water is wet.
Solar is solar, wherever it comes from. You would rather pay more for it? Must be you shop at Kirk’s.
CUC doesn’t set any rates to be paid, OfReg does. And if you haven’t noticed, OfReg has done as little as possible to do anything to bring in cheaper solar for us. Every other country is seeing lower costs from both rooftop and large solar, and we’re raising the costs. Typical OfReg.
Article is misleading. Nothing in the OfReg press release suggests that they are blaming CUC for anything. The previous version of CORE were rates that were developed by OfReg through a consultation process, not developed by CUC. See OfReg press release at the below link.
https://www.ofreg.ky/viewPDF/documents/2024-10-24-17-41-51-PRESS-RELEASE-OfReg–New-CORE-Rates-24-Oct-2024.pdf
Interesting OfReg didn’t undertake any consultative process for a rate change this time around. Probably because it’s hard to justify adding costs for everyone to increase the incentives for just a handful of people to put solar on their rooftops.
Correction. OfReg did undertake a consultative process and one that is similar to that which has existed since the start of the core program. Consultations with stakeholders and the utility.
The FIT program was chosen over net metering in part because it allows for an efficient change of rates or terms from time to time as determined by the regulator when necessary. This is not the launching of a new program nor policy which would necessitate broader public consultation.
It’s funny how certain folks who put out press releases for more than a decade where the rate was an inherent subsidy justifying the broader wisdom and benefits, have now changed their teen entirely for even lesser rates and risk all because the monopoly strategy necessitates it. Company over country I guess.
I don’t recall being asked if I as an electricity customer thought it was a good idea to increase rates paid for rooftop solar. Haven’t been asked this ever to be honest.
I don’t recall being given the opportunity as a public stakeholder to provide comment – can you please direct me to where that took place?
I do not understand why “costs” would be passed on. If they are selling back to non solar customers for more than they are paying for it they are still making a profit for doing nothing
Correct. It’s weird that people don’t understand this.
Next up – “why am I subsidizing the paychecks of people who operate the generators?”
This the reason. Say CUC purchases power from solar CORE generation customers for say CI$0.21. If CUC selling power at say CI$0.15 then the CI$0.06 is passed on to all CUC customers as a line item in their bill called “Fuel Factor”. One can appreciate that this scenario is unfair to the majority of CUC customers who end up with increased Fuel Factor costs.
Because over a decade ago CUC was required to promote solar and they did not want to do “net metering” (with a grid fee) because that would erode their profits faster and give them less control.
Instead they chose a feed in tariff program (CORE) where they could control rates and terms and just pass through costs of solar energy to all consumers.
They made that choice and then spent the next decade telling everyone how terrible and costly it is. You can’t make it up. They’ll try to tell you we have DER program which is similar to net metering but that’s a total economic non starter for 99% of Cayman’s consumers.
What OfReg should also do is not allow CUC to pass through the 100% if the cost of diesel fuel to consumers and instead let CUC feel some of the pain of spiking oil prices via the risk of loss to their own profits. It would amazing how fast CUC would then start begging everyone in Cayman to produce more solar energy (which is cheaper and more price stable) to mitigate that volatility risk to their profits.
https://www.publicadvocates.cpuc.ca.gov/-/media/cal-advocates-website/files/press-room/reports-and-analyses/240822-public-advocates-office-2024-nem-cost-shift-fact-sheet.pdf
No thanks, James. Everywhere else continues to learn the pain of net metering.
Nice try, but that’s far from the whole truth and is typical utility NEM doctrine.
https://solarrights.org/blog/2024/09/03/publicadvocate/
Furthermore I don’t care to advocate for net metering but only to point out the utility made the choice for a FIT program instead… but then spent the past half decade trying to kill it and every other proposal related to rooftop solar because it poses a threat to their monopolist desires.
“CUC has always strived to lower the cost of energy.”
Absolute bollocks when their MO is to make as much money as possible for the shareholders.
This is BS. CUC has provided an awesome service for Cayman over the years, and had never acted like Cable and Wireless, which attempted to keep rates absurdly high. There are many islands in the Caribbean which don’t have a reliable power infrastructure – how many times have there been rolling brown-outs in Cayman – Never! CUC is full of CAYMANIAN employees and they would be the ones trying to screw everyone else – not likely.
5:28, CUC is a monopoly and has provided the only service so it should function properly given the billions they have made. Yes, they employ lots of Caymanians, have politicians and other high-ranking officials who are shareholders, if they didn’t, it would be a different story coming out your mouth.
lol, watch everyone who came into the previous CORE program cancel their contracts and apply for these new rates.
good move offreg except the new rates should apply to ALL on the core program, not just those who sign up after 1st Nov.
Who says you can just cancel your contract?
Wait a second…..OfReg has increased electricity rates??? For who? Madness, maybe OfReg can pay my bill. I thought these people were supposed to be finding cheaper electricity! Also can’t believe it’s CUC concerned about increased costs, shouldn’t this should be OfRegs job???
OfReg isn’t increasing rates; that’s a typical CUC scare tactic intended to protect their monopoly control. See detailed comments above.
OfReg literally increased the rates. What Orwellian nonsense.
No they didn’t because just looking at the CORE rate movement is not how the math works in terms of whether Cayman’s consumers are paying higher rates overall on their bill.
21/17.5 gives you an average of 19c KWh.
Those CORE rates are fixed, they do not escalate over time, the cost of oil does (which directly affects Cayman’s fuel rate). The short term volatility aside the cost so fossil fuels consistently go up in the long term. Over the last year CUC’s fuel rate has hovered around 20c kwh.
So do the math at the current average CORE rates plus the most recent CUC fuel rates with an average escalation rate of global oil prices (most financial analyst will tell you it hovers somewhere between 2-4% conservatively) and you will see the rate as at or below the anticipated fuel rates.
Now add to the fact that as those systems sizes are allowed to increase (something CUC is against) we then further decrease the CORE rates paid to solar customers (ala increase to 250KWs and drop the rate to 14c) and you have an average CORE rate that is well below the fuel rates and thus “decreases” overall rates to consumers not increases.
It’s not Orwellian, it’s just math.
CUC does not set the CORE rates. OfReg also set the previous CORE rates, the decision for which is available on their website following a public consultation process.
Don’t kid yourself, CUC held massive influence over the rates and in fact it was CUC who argued to set the previous rates at a record setting historically low level. Despite being outvoted by OfRegs own independent rate committee, CUC’s arguments were adopted anyway and the prior leadership at OfReg went with CUC recommendations (which sadly they was the case for years that CUC had massive influence over OfReg’s decisions in the past). A dynamic which has now noticeably shifted, which is a good thing for Cayman.
So CUC argued for lower rates that we all pay for = bad?
Increasing these rates for a tiny set of people you sell solar panels to that we all pay for = good?
You’ve made that comments time and again but fail to convince the decision makers when push came to shove and they were armed with the full picture.
No. The rates argued for ensure small producers of solar do so at rates that make it as economically viable for them as the larger richer folks and monopoly utilities who deploy larger systems (at lower rates) AND all those systems collectively reduce the costs of energy below CUC’s diesel generated energy, lowering consumer costs while creating an industry that pushes tens of millions of net dollars into the local economy, creates green jobs and careers, enhances resilience and life safety, ensures competition and consumer choice in energy generation and does not lock this country into a defacto generation monopoly forever that our children and grandchildren are slaves to.
Will Ofreg stop them raising the rates for the rest of us who don’t want to have anything to do with solar panels? I’m not keen on subsidizing people with panels.
But you are keen on subsidizing people who sell diesel fuel to CUC?
These comments make no sense. CUC has to pay someone in order to get the power they sell to you. If they can buy it from a solar producer for less than what they can generate from burning diesel fuel, how does that make you subsidizing the solar producer but not the oil company that was replaced?
Which would be great, except these new rates are not less than the comparative cost of diesel fuel, whereas the previous rates were.
Not when you factor in the construction of new generation capacity.
The population, and demand, is not shrinking, and new diesel generators are not going to fall from the sky like manna from heaven.
Purchasing solar requires ZERO capital expense for CUC.
Solar has been cheaper than burning diesel for years. The panels are better and less than half the cost of a few years ago. Also duty free.
Then all you have to do is lobby CUC to ensure larger solar systems can be installed at much lower rates than the smaller systems so the overall costs of that solar is below the cost of diesel fuel which means the costs to all consumers go down not up. I’ll give you 2 guesses who is blocking that from happening so far but you’ll only need 1.
(Hint: it’s 3 letters)
Luckily this is the first step in a series of steps that will set Cayman on exactly that path despite all the scare tactics and half truths about subsidies.
Should we lobby them to only allow larger systems to bring down the costs even more?
Absolutely, both rooftop solar and utility scale solar (and the specific benefits each provide) will benefit consumers and the country ensuring progressively larger scales.
One group simply argues that the ‘largest’ scale is all that matters. Which is shortsighted, self interested and antithetical to competition.