National

Energy Reform Plan Will Save BPL $87M Annually

NASSAU, BAHAMAS – Bahamas Power and Light could be looking at millions of dollars in savings following the full rollout of the Davis Administration’s energy reform strategy, according to the Prime Minister.

Published

3 weeks ago

April 23, 2025

Berthony McDermott

It comes as the government has entered several public-private partnerships for cleaner energy solutions on multiple islands, which in the end will eventually help to eliminate the company’s debt.

The Davis Administration tabled its energy reform plan in Parliament Wednesday morning, and according to Prime Minister Philip Davis, the reform strategy should return Bahamas Power and Light to fiscal health, generating $87 million in annual savings.

The one billion dollar economic investment comes as the power giant is saddled with half a billion dollars in debt and an aged generation that is strained with the continuing growth of the country, resulting in the power company hitting peak loads.

Rising temperatures and increased energy demand have seen BPL reach peak loads of 281 megawatts in New Providence during 2023.

The grim reality forced the government to rely on rental generation, causing $42.7 million per year, but with this new plan the company expects to produce savings.

Philip Davis – Prime Minister
“$43 million will be generated from eliminating costly rental generators; $13 million will be generated from structured legacy debt payments; $15 million will be due to operational streamlining; $12 million will be attributed to increased reliability in New Providence and the Family Islands; and $4 million will come in from dividends related to the Bahamas Grid Company.”

Davis says the initiative is the largest coordinated energy investment in the country’s history, including $820 million for New Providence projects and $324 million for Family Island projects.

The Prime Minister says the savings will accumulate until BPL’s entire $500 million debt is erased, allowing the company to assist with exploring avenues to address their pension obligations.

The plan makes way for LNG conversion, which PM says will deliver enormous benefits.

Philip Davis – Prime Minister
“By 2026, 177 megawatts of combined cycle LNG generation will replace 107 megawatts of expensive rental units and provide 63 megawatts of additional capacity. Between embracing LNG and improving efficiency, BPL and consumers will save approximately $125.6 million annually.”

The multi-phased strategy saw public-private partnerships with local companies providing clean energy supply to multiple islands like New Providence, Abaco, Eleuthera, Cat Island, and Exuma.

Energy Minister Jobeth Coleby-Davis says the previous energy policy was written in 2013. The new energy policy covers the next five years. Davis says the plan will also create jobs.

Philip Davis – Prime Minister
“1,000 jobs will be created during the construction phase of the reform process. And hundreds of permanent jobs will emerge in operations and maintenance.”