Solar report shows CUC underpaying on CORE
(CNS): A now dated and previously secret report on the value of solar has finally been released by the utilities regulator, OfReg. But because the report took two years to complete and was kept under wraps for even longer, it calls into question the usefulness and relevance of the work, which is now more than five years old.
Nevertheless, the Value of Solar Study (VOSS), paid for by the public purse, does show that CUC’s CORE and DER customers have not been getting a good deal and are losing out on at least 6 cents per kilowatt hour, based on the technical experts’ findings.
The report was commissioned by the regulator and conducted by the independent non-profit, climate and energy organisation RMI. But OfReg has now distanced itself from the findings, which cover a diverse but technical review of the solar landscape in Cayman.
Most importantly, the report’s conclusion relating to the rates that should be paid to domestic producers of solar power are higher than OfReg approved for CORE and DER customers.
The current rate paid to CORE customers is just 17.5 cents, while the study recommended 24 cents as representing value for money. Based on these conclusions, Cayman’s solar producers are not receiving the full value for the solar energy they produce and sell to the CUC grid.
Another notable finding in the report is that, given the cost of land in Cayman and other relevant factors, rooftop solar should play a major part in transitioning the country to renewables and ditching the fossil fuels.
The received wisdom is that utility-scale solar is the only way to get to the government’s very ambitious targets in the National Energy Policy because solar farms won’t necessarily prove to be any cheaper.
In the conclusion to their executive summary, RMI said that overall, the study provides integral insight on the value and opportunity for developing solar power in the Cayman Islands, which could elevate the country towards achieving its envisioned clean goals future outlined in the policy.
“The sixteen variables considered in the VOS study provide a comprehensive assessment of the overall value of distributed and utility-scale solar for the Cayman Islands. This study highlights clear opportunities for the country to harness its local resources to develop an electricity system that offers greater reliability, lower costs, and society-wide environmental and economic benefits for the country,” the report’s authors stated.
James Whittaker, the president of the Cayman Renewable Energy Association, said the non-profit advocacy group was pleased that the critical study had finally been released but disappointed by the lack of transparency and timeliness in decision-making and its public disclosure.
“CREA first lobbied for this study to be carried out over five years ago. It then took approximately two years for it to be actioned by the regulator and almost three years to be released to the public after its completion,” he said.
“Despite the National Energy Policy requirement that rates paid to solar producers must be informed by the value of solar studies, due to the lack of regulatory transparency it remains unclear if or to what extent this study factored into the decision-making regarding solar rates.”
Whittaker said the delays by OfReg were not the fault of the current management and board. He said the CREA is hopeful that the next study will be carried out in a more timely and transparent manner and that the experts’ recommendations will be adhered to. However, he added that OfReg should clearly explain “any deviations in decision-making outside the experts’ recommendations”.
The very technical report was the subject of freedom of information requests that had been refused. But in a release issued Thursday, OfReg Interim CEO Sonji Myles said that he and his team had reviewed this and determined that there were no valid grounds under the FOI Act to justify the continued withholding of the document.
“In the spirit of transparency, accountability, and public engagement, we publish this report along with a disclaimer to the public as part of our efforts to support informed dialogue around renewable energy policy and to ensure that key regulatory decisions are accessible and evidence-based,” he said.
However, he also distanced the regulator from the conclusions, stating that while the report offers valuable insights, the findings and conclusions don’t represent the official position or policy or constitute an administrative determination by OfReg.
“Accordingly, the VOSS should not be interpreted as binding upon the Office, offering any guarantee of financial returns to any person; confirmation of applicable rates; nor an indication of specific policy direction,” OfReg stated in a disclaimer. “Any decisions or actions based on the study would also require the Office to take into account other important factors, including but not limited to economic feasibility, impact on consumers, regulatory requirements and broader energy policy objectives.”
The office said it was committed to facilitating informed discussions on renewable energy development in the Cayman Islands and looked forward to continued engagement with stakeholders as part of the ongoing energy transition.
CNS has contacted CUC about the release of the study, and we are awaiting a response.
See the VOSS report below:
- Fascinated 92%
- Happy 20%
- Sad 61%
- Angry 48194%
- Bored 82%
- Afraid 61%
Category: Energy, Science & Nature
There is no better illustration in Cayman than CUC to remind us that we are a Banana Republic with glass windows.
Lots of emotion but no facts…. At least CUC pointed out that we are all paying for the solar on peoples roofs and if the cost goes up so does our bills…..
Why the hell should we have to include CUC in our decision to go Solar anyway?
If you go completely off-grid then they don’t have to be. If you connect to the electricity network they need to be involved to make sure you are not going to stuff it up for the rest of us.
Some months ago new rates were announced for Solar, In my case the new applicable rate is supposed to be 17.5 cents per KW.
However, I still only getting 15cents a KW!
Apparently, inorderfor me to get the 17.5 cents I have to re-apply for a new approval!
WHAT A PILE OF CRAP and chicanery!
When CUC wants to increase their rate to Consumers, they do not ask us to approve the increase, they simply implement it!
CUC stop the Bovine excrement and pay the new rate!
https://www.ofreg.ky/viewPDF/documents/2024-10-24-17-41-51-PRESS-RELEASE-OfReg–New-CORE-Rates-24-Oct-2024.pdf
Try to point your finger in the right direction.
My solar system can produce 14.4KW and CUC will accept all of it but only pay me for 10KW. I don’t understand why CUC would cap its CORE program at 10KW per customer. At their low pay-out rates, why wouldn’t they want to purchase every bit of solar or alternative energy they can get so they dont have to produce it?
I expect you mean that you have 14.4kW(dc) in solar panels, and a 10kW (ac) inverter. Your panels will almost never produce their rated power, except for a small period of time each year when conditions (sun, temperature, etc.) are perfect. If you had installed a bigger inverter, you would likely have made a poor investment choice because the tiny amount of additional solar production wouldn’t outweigh the cost for the larger inverter.
To protect revenue. It is NOT for technical reasons. The overriding reason however is for control. Control is their mantra under the guise of being a great corporate citizen.
Glad for RMI’s analysis and findings.
Sounds like Mr. Myles is still collared and securely on CUC’s leash, ergo his lap dog disclaimer. What is the benefit of commissioning more studies that show CORE customers are being shorted when all these accomplish is to prove their inefficacy?And think who actually pays for these studies, they’re not done pro bono. The status quo exists and no politician, incumbent, new candidate or party is about to change that. The stitch up continues.
There are plenty of studies available overseas. You can also easily find out on Google what rates are paid for consumers with solar powering the grid. What surprised me is that all the examples I found pay a lot lot less than what is stated in the OfReg report. Perhaps someone should check the maths and make sure the solar companies have not had an influence.
It’s like a spy story.
Sonji Myles, “CUC’s man on the inside.”
Actually unfair to put this on Mr Myles and his team. This has everything to do with the prior regime.
Why do we the taxpayers have to pay for the report and this Myles guy’s salary as well, yet they want to keep it under wraps so we can not see it? Just goes to show what the majority of us already knew that CUC is ripping us off and our elected representatives just sit around and let it continue. Time for Myles and the rest of Off Reg to be sacked.
Everyone who understands electricity, power and solar has been screaming this from the rooftops for years!
They have been screaming that ofreg has nobody on staff who understands what they’re doing or supposed to regulate. CUC has actively pushed to suppress this information to maintain their monopoly and the criminally-low rates they’ve pushed for solar.
Ofreg has been completely negligent and asleep at the wheel. Not only with CORE and DER (the DER structure should have someone in jail) but also with the demand billing scheme for large commercial. The rates are literally the worst in the world.
Anyone who had a hand in keeping this report secret should firstly lose their job (public or private) and secondly, face criminal charges.
Let me get this straight: you want criminal proceedings brought because the rates paid by consumers in Cayman are AT LEAST 6.5 cents LOWER per kwh than they could be?
The rates paid TO consumers not by consumers – try a little reading comprehension…
The rates paid TO consumers are also paid BY consumers.
CUC doesn’t buy at one price and sell at another. They buy at that price and sell it on at the same price.
Rates paid to consumers are paid for by consumers.
On your bill there is a line that is titled ‘Renewable Energy’. This is what is paid to people with solar divided between the consumers who do not have solar.
So higher rates paid to people with solar will increase this cost on my bill since I do not have solar. I am basically paying for your home solar.
Private sector company and a private sector run Board. Put together you have one word incompetence. Don’t worry our civil service will come to the rescue one again.
You could try but first you would have to learn how phones work.
We are blessed with abundant sunshine almost daily all year long.
Solar energy is the way.
I agree with you. CNS should write an article on how much a residential solar installation costs in Australia (who have lots of solar) and do a quick comparison. The information is published by the solar industry there. You will find installations here cost more than twice the price (and don’t ask how many years I had to wait to get mine installed after I paid my deposit). Before someone criticizes my comment and moans about important duty or Trump tax please do your research. The solar companies here are ripping people off and making healthy profits. The industry should be regulated (since I don’t think it is currently) and someone should scrutinize their pricing.
Ahh Mr T, (rolls eyes) this ole chestnut….. you’ve been shown repeatedly shown why Australia vs Cayman solar costs is 100% comparing apples and oranges.
You avoid comparing the North American or Hawaii costs to Cayman’s costs because that shows the costs of solar energy here is very comparable, not to mention the CUC grid uses North American standards (UL, etc) along with Hawaiian (HECO) grid standards and not Australian standards for solar.
Because you’ve been shown this time and again yet you keep repeating this demonstrably false analogy it simply proves your willingness to intentionally mislead the public.
I of course won’t say your name, I remain hopeful you and your colleagues will be brave enough one day to start putting your names to these “anonymous” posts in the name of transparency.
Regards,
James Whittaker
Good evening Mr Whittaker. XXXX Perhaps you can also tell me how the Australian standards are so different to US ones that warrant your solar systems being twice the price rather than just dismiss my point. There is probably something we can learn from them that can be applied here to move us to a solar future.
Open up the industry and programs so that a) people want to participate and b) there is enough runway for financing appetite. CUC blames the industry for ‘high costs (they are not) when they are actually the cause or the opportunity to reduce by bringing more scale and competition. This IS the real world.
So let me get this right. It takes at least 3 years for Ofreg to release a report saying that CUC have been underpaying solar customers by at least 30% and this is OK?
This is corruption at the highest levels and a monopoly using its power to stop all reasonable competition. This is a good example of what Cayman currently is and what it will continue to be until the government takes real action to break this kind of monopolistic behavior.
Cayman’s stance on solar is a joke. We have abundant Caribbean sunshine and we generate 3% of our electricity from Solar. At a minimum we should have absolute net metering where we can net off all usage and then sell back whatever is over to the CUC at this prescribed number of 24 cents a kwh. Until that happens expect more of the same where solar usage remain well below 10% of all capacity.
The ONLY solution here is to break up CUC into generation and network and then create regulations around the network around what it can and cannot do. This includes mandating that net metering needs to come in at defined reasonable rates for all electricity produced. Only then will home owners feel confident enough to invest in solar enough to allow for the type of investment required.
What a great idea. Let us look at how that worked out in the telecoms sector where we now have more companies and higher bills…. and I will let you draw your own judgement on the service. Your proposal will certainly benefit the people who can afford to put in solar and also the profit margins of the solar companies, but the people who can’t will end up paying more. Please think of everyone rather than just yourself.
If you have lots of money then you have political influence, with that influence you then get to do whatever you want. We are a country of for the rich and to hell with the common person. If you do not like it then pack up and leave.
Once PPM gets elected than we will all be good, Premier Joey will make sure of it.PPM-PPM-PPM
CUC is also exploiting electric vehicle users with their $0.40/kw Zef chargers. They have a valuable license that should be withdrawn if they can’t deal fairly with the Cayman Islands consumer.
CUC is exploiting everyone, haven’t you looked at your electric bill lately? They do a nice commercial though.
My bill last month was one of the lowest it has ever been, lower than the month before and lower than the same month the year before.
I got new insulation installed and it has made a huge difference to my bill. I did look at the cost of installing solar, but I could not afford it and the insulation was cheaper. I am really pleased I am much better off.
Well worth looking at the options to reduce your bill.
I have solar, and I generate more electricity for CUC than I need to air condition my house. CUC therefore end up owing me money at the end of every month. What’s annoying is that apparently they don’t actually pay me, they just wipe the balance at the end of the year – i.e. take the cash!
Anyway, my point is that it’s perfectly possible to insulate a house so that you don’t use much power.
OffReg, why is this allowed? Would it be to ensure CUC makes a profit from solar?
Big picture, this appears to say (in 99 pages) that the Value of Solar (VOS) on rooftops (Distributed) vs Utility scale is broadly the same. The finer details are debatable.
This report should not be used as an excuse to hold-up the roll-out of competitively-bid, utility-scale solar, which will benefit all and is badly needed to help reduce the cost of living.
Nor then should the claim that Utility Scale is cheaper than rooftops (Distributed), right?
And since rooftops (Distributed) solar has social advantages over Utility Scale (and environmental unless the Utility Scale is reusing ‘brownfield’ sites, e.g., old quarries in Cayman’s context) then clearly – as the National Policy says – we should be pursuing Distributed solar.
Why then, in the same post where you recognise that there is no (cost) advantage to utility solar do you immediately pivot to a push for utility solar?
And before the rebuttal asks why do I push for Distributed? Not as a supplier but because as a consumer I’d like to get some of the advantages to myself that a Distributed system would bring which a Utility Scale will not.
The original poster spoke about value. You’re speaking about cost.
Value and cost are two completely different things. What matters is the difference between the value of a good and the price we pay for it. The bigger the difference, the greater the benefit. The cost is whatever is needed for someone to (happily) invest in solar. The rest is what we all gain.
Cayman needs more solar, asap. Inaction is costing everyone. We already have distributed solar, we lack large-scale utility solar. I suspect the latter can be rolled out a lot faster.
I also advocate for utility-scale because not everyone can afford distributed (a social disadvantage), and things rarely prove as clear-cut as they seem when it comes to pros and cons. Why go all-in with one method? Competition is healthy.
I am neither a CUC shareholder, nor a distributed energy system owner or supplier. I would just like to see Cayman’s energy costs come down as soon as possible.
No, large scale solar cannot be rolled out faster than distributed. One requires a long involved negotiation between OfReg, CUC & the new solar plant (after they’ve won a competative bid through OfReg to negotiate with CUC, which CUC might win themselves). The later just means slapping panels on a roof at the set payback rate. – Paid for by ‘cheap loans’ but that’s again a straightforward financing offering. Because as you say not everyone (most of us in fact) cannot afford to put the solar panels on ourselves, but we can afford to ‘rent’ our roofs to the finance company (or top up our mortgages) allowing the social benefits of distributed solar. Simple, but not as big a payday for whoever gets the next solar farm contract. Currently there is no competition of methods because CUC & OfReg don’t want distributed solar. (Hence keeping the report secret for years, then putting it out as ‘not to be used as a guide’ warnings.)
I am not sure why you keep saying that CUC and OfReg are against distributed solar. Their press release is pro solar, there is a CORE/DER programme that is not over-subscribed, and the solar rates have just been increased. It certainly doesn’t come across as actions to deter distributed solar.
I doubt it’s so clear cut on deployment time. If you wanted to do 50 MW of solar, that could be done in 1 or 2 bigger solar farms. For rooftop, assuming houses at 10kW on average, you would need to put in 5,000 systems. Remember that goes through Planning and it would be incredibly unlikely that government would increase staffing.
Maybe our takeaway is that in a race between Planning and OfReg, we all lose?
Anyone with solar on their house will of course be asking for more money…. And if you are paid more then the people without solar will need to pay more too – Sounds a great option for you and not for me and a lot of other people who cannot afford solar. I already have a line on my bill where I have to pay for your solar. I don’t want this to go up just so you can be paid more. Please be considerate and think of the people who are not as well off as you too.
If the CUC-Pay-Solar rates go up more people will find it economically feasible to put up rooftop solar and sell it to CUC. While the CUC-Bills-Solar rate will also go up it will still be less than the CUC-Bills-Diesel rate (so the argument goes, and according to the report)
I think you will find that the current solar rates per kWh are more than it costs to generate from diesel.
Increasing the solar rate further will only increase my electricity bill.
keep voting for the same liars and you will keep getting the same results.
CNS – I believe your headline is incorrect and rather misleading. Isn’t it the regulator (OFREG) that set the rates for CORE – NOT CUC? You should not blame CUC when someone else sets the rates. They just pass on the actual solar costs to the rest of us who don’t have solar on our houses.
The regulator’s stamp of approval is required before rates go into effect is it not? If CUC implements the rates autonomously then why if OfReg even required as a regulator?
I looked at the OfReg website and saw it was OfReg who set and announced the new rates. Perhaps it is me, but I cannot find anything saying CUC set the rates for solar. Where are you looking? I
more garbage from cig and ofreg….