Barbadians could soon have the option of paying for their electricity before they use it.
Updating journalists today on the company’s plans, Managing Director of the Barbados Light & Power (BL&P) Company Roger Blackman said it would require the company to submitted an application to the Fair Trading Commission (FTC) for approval, adding that it could take about three years to roll out.
While stating that the company was focusing more on customers, as evident in its creation of a customer relations department, Blackman said a lot of research and valuation work was being carried out in relation to the plan.
It forms part of the company’s “grid modernization” programme, and Blackman said it should result in an improvement in energy management, adding that it would attract a “time of use rate”.
In addition, the BL&P top official said the move would help the power company to remain relevant and to prepare for future competition in the renewable energy sector.
“A part of that is advanced metering infrastructure and over the past year we have deployed a pilot programme with about 1,500 smart metres onto the network with two-way communication that has worked very well and therefore we are now preparing to deploy on a full scale across the island,” he added.
In the long term, the former monopoly energy provider hopes to move away from estimate billing and to allow its customers to have hourly monitoring of their energy use.
“It is not novel in any way, it is available in other markets. Jamaica and Dominica have similar services,” Blackman acknowledged.
“Basically it is similar to what exist with cell phones and prepaid services for cell phones. What happens is that you can pay up front for X amount of kilowatt-hours and once you have paid for those kilowatt-hours, you then use them. When it is coming up to the point where you are running low then you just top it up and you go from there,” he explained, adding that the company had been running some tests.
Blackman, who recently returned from training in Halifax, Canada, also revealed that the power company had also applied to the FTC for permission to introduce a fuel hedging system for which it hoped to get approval by the end of next month.
Blackman explained that the proposed system would protect the company, and ultimately customers, from the current oil price volatility.
Currently, fuel purchases are a “pass-through” cost that is applied equally to all customers through the Fuel Clause Adjustment.
By using hedging to stabilize fuel prices, fluctuations in the Fuel Clause Adjustment will be minimized, he said, adding that the cost of the fuel hedging would be tied to the Fuel Clause Adjustment mechanism formula, which determines the cost to customers. This, officials said, would allow customers to plan better and shields them from “major swings” in oil prices.
“So it is basically an insurance against the volatility and large swings in oil prices,” Blackman said.