NCFC reviewing OfReg’s rejection of CUC solar plans
(CNS): The National Coalition for Caymanians is reviewing the recent decision by the utility regulator to dismiss a CUC solar power generating plan — a decision that could set back Cayman’s transition to renewable energy, which is already incredibly slow, by decades. Premier André Ebanks told CNS that switching to renewables is not just important for the environment, it is also a “pocketbook issue” and a route to reducing the soaring cost of living.
Despite the pressing need for the Cayman Islands to switch from fossil fuels to renewables to meet the ambitious goals of the National Energy Policy, OfReg, which is locked in a literal power struggle with CUC, rejected its plan for generating 90MW of power through solar using battery storage because the regulator said this didn’t meet the definition of ‘firm’ power under its licence agreement.
OfReg has argued that its decision was not a rejection of solar but about fairness and the terms of the licence. Nevertheless, the outcome is the same.
In response to CUC’s submission for a Certificate of Need for this new power to meet future demand and, importantly, replace aging diesel generators, OfReg would not accept that solar combined with battery storage could be considered a ‘firm’ power source. The regulator said the terms of the CUC licence require this to be firm, effectively mandating the continued use of fossil fuels.
Commissioning new generators that burn fossil fuels to meet more than half of Grand Cayman’s future electricity needs would be a major blow to the transition to greener energy, as well as an economic step backwards.
Ebanks said that most members of the coalition campaigned on accelerating the rollout of solar energy, and this was reiterated at a recent retreat where government members met to begin rolling out the NCFC joint policy agreement.
The premier said the coalition “was now taking stock of where things were left off from the last administration and thinking through what fits” with the new government’s agenda. He stated that Infrastructure Minister Jay Ebanks has had informal briefings with OfReg and CUC and will report back to caucus, given the newly elected government’s position that there is a need to transition to renewables as quickly as possible.
“We are reviewing the situation to set policy,” Ebanks said, noting the economics of the change. “Moving to renewables is not just the right thing to do… It’s a massive way to cut the cost of living. It’s not just an environmental issue but an economic or pocketbook issue,” he said, confirming what he told CNS after the TCCP formed at the beginning of the year.
In January, Ebanks said that greening the economy was at the centre of the party’s policy platform to bring well-paid, future-proof work and new careers for local people, cut the cost of energy bills, reduce inflation, improve resiliency in the face of climate change and reduce welfare spending.
However, it may mean that the government will have to change the wording of CUC’s licence agreement, given OfReg’s insistance about the conditions of the license and the way CUC has tried to retain control of power generation by dodging a potential competitive bid for solar energy.
But if the government does not act, the legal disputes over the interpretation of the CUC deal and the conditions surrounding the certificate of need for new power generation will stop the move to renewables and make the National Energy Policy targets impossible to meet.
Meanwhile, the people of Grand Cayman are continuing to pay high electricity bills for power generated by air-polluting fossil fuels. The island also remains hostage to the international oil market fluctuations, with weak bargaining powers as such a small buyer, vulnerable to international blockades, tariffs and other geo-political risks.
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Category: Energy, Politics, Science & Nature
Like most of Cayman, I’m just a customer of CUC. Not an employee, not a shareholder. But I wonder about all the animosity directed towards CUC.
My bill for my 4br house used to be in the $900 range monthly. Then I changed my AC units and my bill dropped to the $4-500 range in summer and low $300s in the cooler months. My current bill is just over $400.
We are an expensive jurisdiction and Govt makes everything more expensive by getting their cut on everything imported, plus other fees. CUC is in the business of making profit, it does not provide charity.
Instead of criticizing CUC about the cost of electricity, try to take measures to reduce one’s own usage and follow CUC’s suggestions on lowering power consumption.
Please don’t ever forget how efficient CUC is! We have reliable power, perhaps the most reliable in our entire region, for most of the year. When outages occur, they are usually rectified in record time. CUC is every bit as efficient as the very much larger FPL next door, but it can never deliver services at FPL costs due to economies of scale.
Stop bashing CUC, manage your own power usage better and be grateful we’re not in Cuba, La Ceiba or some other regional locations!!
Apart from a little green washing, the monopoly electricity provider and the Govt have no intention of progressing Cayman to wide scale renewable adoption.
Have you read CUC’s certificate of need submission to the regulator? It proposed several options and recommended one that was mostly renewable/batteries – with only a small amount of thermal. Why recommend a renewable option if you are against it??? So I am not sure your comment about the monopoly utility has any facts supporting it.
OfReg on the other hand appear to be against wide scale renewables since they discounted the renewable options and proposed that all of the new generation is thermal.
Will be interesting to see if the Government act on this…. that will be a big decider.
If they deny it, people say OfReg is against renewables. If they are in favour of it, people will say OfReg is colluding with CUC. OfReg can’t win boy.
How about this: all of you who are so critical about OfReg, I invite you to exercise your democratic right and sit in on Judicial Reviews. You would have a much different picture, but I guess this commented will be missed or undermined.
The point is not about the decision colluding or not colluding with CUC – but it is about OfReg deciding that the 90MW of new generation has to be thermal…. an option that will keep electricity prices high and not reduce emissions (nor a dependency on diesel or gas). It just doesn’t appear to be representing value for Caymanians and is at complete odds to the Governments National Energy Policy.
I think the challenge is that the regulator has picked a winner – with the 90 mw having to be thermal.
Would it not have been more beneficial to say 90 mw of new generation was required and then ask suppliers to offer their best price and show how their selected generation type will work? Then us customers will be able to see that it is least cost and viable. Picking thermal as the only option appears to have cut out renewables and will keep prices high.
There was a comment in the Compass by “Frank S” saying there is an LNG terminal “in the plan” at the quarries in Breakers and to run a pipeline down the East West arterial as it gets built. The plot thickens!
This is not a problem as long as there is backup diesel-fired power generation, but if diesel-fired power generation is discontinued in the future, the currently planned battery capacity is not at all sufficient to provide a stable supply of electricity using only solar power. Compared to other energy sources, solar power is the most unstable power source and must be used in combination with other energy sources. Other major power sources could include wind power and green ammonia-fired power generation. Ammonia is said to be cheaper than hydrogen as a CO2-free energy source, and is considered a promising marine fuel. Production plants are being established in countries around the Cayman Islands. It is not wrong to start with solar power, which is the easiest to introduce, but wind power should be introduced next. Since solar and wind power are unstable in supply and susceptible to hurricanes, a minimum amount of green ammonia-fired power generation should be introduced, even if it is relatively expensive. Until the price of green ammonia stabilizes, co-firing with fossil fuels could be considered.
# Smash the CUC Monopoly
# Separate distribution from generation
# Net Metering NOW!
…I note the electricity company dinosaur supporters are out in force, defending the status quo…. Of course, they are benefiting from the monopoly and the gold plated largesse hardwired into the system they themselves created and will do anything to maintain.
Remember the days when the then telecom dinosaur on island cut-off peoples’ internet if they were using “Skype”?
Then, the unleashing of telecom competition meant that they that to reform, compete, reduce their costs and up their game (or not – there was competition, so we had and continue to have, alternatives….). Now today, my monthly telecom bills in total have not increased in real terms since the year 2000 – I remember monthly bills back then of KYD300 to KYD400 and more (for mainly international calls..), today we have WhatsApp….
Distributed solar for the electricity dinosaur is the equivalent of WhattsApp was to the telecom dinosaur…..
Adapt or face oblivion.
Not sure I follow you. OfReg pushing for competition and CUC wanting generation that is not diesel is very different to the status quo.
All new generation to be thermal running on gas or diesel would be the status quo. CUC appear to have presented a case showing large scale solar/batteries is the least cost to us consumers. That is very different to the status quo. CUC is not allowed to go and build this, but OfReg need to run a tender process where anyone can bid. But for some reason that I cannot understand is OfReg stating that new generation has to be thermal…. Which will result in the highest price.
Others countries have a mix of thermal, solar/batteries, and distributed solar and the electricity prices are a lot less. My bill when I lived in the US was around $130 per month – not $460 that I pay here. Reducing the consumption of diesel will have the biggest impact on consumer costs.
Worth keeping an open mind. Competition for generation and diversification of generation type has to lead to a better result.
…I was referring to all the down voters on comments not supportive of CUC’s part line….those supporting the status quo versus those supporting change.
What you refer to is tinkering around the edges only…CUC still line the pitch, ref the game and decide the curvature of the ball on a whim, round, oval (what ever and when ever the choose..)
Distributed solar with Net Metering is NOT the status quo. That is what is needed.
A lot of countries introduced net metering when home solar systems took off. It looked like a really good idea. However, several years on and most countries are now removing their net metering schemes, reduced solar feed in tariffs, and putting in place schemes that encourage people with distributed solar to feed in their power when it is required over the evening peaks. In Cayman’s case the peak is in the evening after the sun has gone down.
I think a lot can be learned from what has been conducted overseas. Rushing to put in net metering here when most other countries have not got it to work doesn’t sounds like a great idea to me.
8.02am I’m glad you consider the poor service the Telecom companies offer nowadays to be upping their game. When C&W invested in young Caymanians and the company employed majority Caymanians their service was top notch.
..you totally mis-read what I said.
You are correct in your characterisation though, the old electricity and telecom dinosaurs where very much like the CI CS and the CI PS – bloated, over paid and non-performing……
Government needs to ensure they consult the right people to fully understand what CUC is actually trying to achieve here; before they fall right into a proverbial trap that was set from years ago.
If you are the James Whittaker from Solartech and CREA then you should declare your conflict of interest in any ‘consultation’.
Putting in grid scale renewables/storage will reduce the cost of electricity. This will make roof-top solar installations less competitive and revenues for your business will decline. I would be against large scale solar/storage if I was running a business like yours too.
I think the value is looking forward to what would benefit all of us Caymanians rather than just a select few.
The last time government consulted with you on the topic, Peter Griffen stood on a stage in Miami and said the government was going to own all future large solar projects. Don’t you have a turtle-shaped ice rink to go sell a revitalized George Town?
Renewable is firm power once it’s remobilized into grid-leveling battery networks.
Are we going to have enough battery power to run on during a two week period of cloudy rainy weather?
I wondered about that too. However, it was CUC who has suggested grid scale solar and batteries. They need to operate the system and ensure the lights stay on – so do you really think that they have not thought about that and talked to other utilities around the world that operate a blend of thermal and solar/batteries?
If it was me I wouldn’t be suggesting something that was then going to get me into a lot of trouble.
Not according to CUC!
Disband OfReg and fire every single one of those incompetent imbeciles who suck up tons of money in salaries!
The only outfit I trust less than CUC to make good decisions for the country about electricity generation and supply is OfReg.
When I lived and worked on Cayman. I could not understand why more people weren’t using solar panels and still can’t.
It’s because they can’t get approval to install them.
Approval from who?
There is an allocation for generation from roof-top solar approved by ofreg and it is not oversubscribed.
Perhaps it has something to do with the cost to install it?
I call bovine caca. There is availability today for something like 400-600 homes to add solar to their rooftops. The ability to get approved isn’t stopping anyone.
You need permission to bring them into the country and then Planning permission to instal them.
Because the kind of people who could most benefit from them cant afford them. So you know what happens? with the current system the average joe is paying to subsidize rich peoples solar panels.
It is because CUC never wanted to adapt to solar in the first place. They had to after running out of the previous excuses (not valid reasons) why they couldn’t/shouldn’t. Then they have made it impossible or very difficult at best and then really they just want to own all of it anyway.
It’s ALL about control.
And they have gotten away with it as there has been very little political will and a totally ineffective regulator. The latter two points however are showing signs of real cause for optimism.
p.s. not so long ago the Minister for Energy was the CEO’s brother. You can’t make this shit up. Way worse than planning or the liquor licensing as it was.
A bold statement you make. So tell me why the current utility has made it very hard?
There appears to be an allocation for distributed solar that is set by the regulator and is not oversubscribed. Plus any new large scale generation is tendered by the regulator. Anyone can bid on that generation.
Yes CUC can bid on the tender, but the regulator should be transparent about who wins and why.
Bury the powerlines!
have you ever thought to ask… why this hasnt been done?
1 word, HEAT. Power lines get hot, do you know whats really good at dispersing heat? moving air!, hence why your car has a radiator and so does your AC compressor and why power lines in hot places are strung above ground. You know what really bad at dispersing heat? dirt… in fact, dirt does the opposite, its a really good insulator, so good in fact that the heat generated by the resistance of the power lines cant be easily dissipated.
You can do it in small scale, residential complexes for instances or commercial complexes have the secondary lines run down and underground but the mains? those big line at the top of the poles carrying anywhere from 4 to 34 thousand volts? yeah those don’t like being underground with no means of being cooled.
Arizona has buried powerlines in most of their developments with no issues. Their summers are much worst than ours.
Vegas (and most of Nevada), too. The person you’re replying to is simply misinformed.
Re-read your answer and focus on the word development. Many developments (subdivisions) in Cayman also have underground power wires. Those are not the very voltage lines like you see at the top of the poles.
Building new thermal generation here on Cayman will keep electricity prices high, the diesel or gas suppliers will hold us to ransom, and is completely the opposite direction to the National Energy Policy.
I think there should be competition for any new generation and all types should be considered (rather than the regulator limiting it to thermal). The least cost for consumers should be top of the selection criteria. Since the regulator is representing us consumers the whole process should be transparent… too much to ask for?
maybe check to see what the laws that the regulator has to follow?
So are you saying there are laws that prevent the regulator from representing the interest of electricity consumers and striving for the least cost of electricity?
no I am saying that there are laws which state what firm power means and currently I don’t want to be here when the batteries run out but the clouds are still sticking around for another day or so.
Solar and batteries are widely used internationally – especially on island systems.
Do you really think that CUC would recommend solar and batteries if it would then leave them short? They either have not thought about this, which I doubt since they are quite good at keeping the lights on, or they know exactly how it will work with the existing thermal units and distributed solar.
There is no definition for that term in any of the laws here. Try again.
There was a CNS article dated April 2022 stating that OfReg were tendering for solar farm with batteries. What ever happened to that?
I don’t think OfReg have issued it yet. The new generation it would have provided should have been built and operating by now. Might explain why CUC is complaining about there not being enough generation and last year we were told there may be rolling power cuts.
Rolling power cuts by CUC would also constitute a non-firm energy supply, and thus be in contravention of their licence.
So are you saying that because OfReg have not tendered the solar that they said they would back in 2022 and there is now not enough generation that CuC are in breach? I don’t think I would like to be CuC if the regulators slowness results in that consequence. Doesn’t appear fair to me.
I think that Ofreg should put their hand up and admit that they did not tender that solar in a timely manner, which now means there is a shortage of generation. They should not blame CUC if they have not done their job.
OfReg cannot put out the tender until the person(s) who have already been chosen to win the bid are ready.
They are still trying to get the tender issued. 3 years on.
This new government is making many people very happy…now, if they could just make a positive announcement on the plan forward for the dump!
A positive step by NCFC to look into what consumers need. Lets hope something comes of it. I would like a lower electricity bill and building more thermal generation makes no sense at all – especially if there are cheaper renewable generation options that will lower costs.
Excellet news! Congrats on your fortitude, NCFC!
The problem with OfReg, and other supposedly independent government entities, is that they are ruled by a politically appointed Board. The Minister and the Chairman of the Board make ALL of the important decisions, which get rubber stamped by the rest of the Board members, or they get replaced, and then it’s reported in the news as OfReg decisions.
That was Jay’s and Sammy’s decision, now we are going to see how much control Andre really has over Minister Jay. If Sammy remains as Chairman, that’s your first clue.
Not to sound rude, but the recent decisions from ofreg do not appear to reduce the cost of my electricity nor move the country forward towards the governments energy policy – what an embarrassment.
I think it would benefit from them all being replaced by people who can move this forward rather than the current board who just spend their time saying that they cannot for a variety of reasons.
I would like to pay less for my power and the decisions made so far will only keep my power bill high. Who is representing me as an electricity consumer?
Maybe someone can provide me with updated figures, but CUC has around 166 MW generating capacity, and consumption ranges somewhere in the neighborhood of 75%. With diesel storage of 1.3 million gallons, and a generator efficiency of .065gal/kWh, then in the event of a global diesel supply disruption, how long until the lights go out?