Declining Fuel Costs Continue to Offer Savings to FortisTCI Customers

CUSTOMER CARE 649-946-4313
Mar 26, 2015

 

Crude oil prices in the world market began to tumble in July of 2014 and reductions were first seen in the supply chain to the Turks and Caicos Islands in September 2014. The Fuel Factor for February 2015 landed at $0.1566 (which appears on customers March 2015 bills). The fuel factor has not reached these lows since 2010 with the lowest calculation being $0.145 in October that same year.

 

The Fuel Factor (or Power Cost Adjustment), in accordance with the TCIG Electricity Ordinance Section 32, is a monthly charge that represents the cost of fuel used to produce the electricity consumed by each respective customer. (That is, the Fuel Factor apportions the cost of fuel to each customer based on the customer’s kilowatt-hours (kWhs) usage.) The Fuel Factor mechanism enables FortisTCI to recoup the cost of fuel charged by the Company’s fuel supplier, and the calculations are validated monthly by the Energy and Utilities Commissioner’s Office.

 

Fuel Factor adjustments, sometimes called “Energy Supply” or “Power Cost” adjustments, depending on the primary source of energy (diesel, coal, hydro, nuclear, wind, or solar), are common cost-recovery mechanisms in the utility industry worldwide. In the Caribbean, because diesel fuel is the most common means of producing electricity, the term “Fuel Factor” is commonly used by utility companies. The cost of fuel varies from country to country, depending on such factors as deep-water port infrastructure, and ultimately by cost of fuel in the world market. As world-market prices fluctuate, so does the Fuel Factor. Diesel remains the most economical means for electricity generation in the TCI, as is the case for the entire Caribbean, and for comparable small, isolated, island utilities throughout the world. Indeed, this is even the reality for the US state of Hawaii and for Sir Richard Branson’s private Island, Necker Island, in the British Virgin Islands; venue of the recent meeting of the Carbon War Room and some regional governments on renewable energy, including the TCI Government. To date, Necker Island has no reported utility solar energy infrastructure.

 

FortisTCI President and CEO Mr. Eddinton Powell said, "The lower fuel factor, as a result of what is happening in the world market, is good for our customers who are seeing much-needed relief on their electricity bills. Moreover, FortisTCI is committed to long-term reduction in the cost of electricity in the Turks and Caicos Islands, and in that regard, we continue to explore infrastructure development that would streamline and simplify our fuel supply chain which would reduce, on a long term basis, the cost of electricity to our customers.”

 

Mr. Powell added that the Company is also committed to integrating renewable forms of generation, like wind and solar, into the energy mix. “However, we will not support changes that increase the cost of electricity to our customers, or reduce the safety and reliability of our service.”

 

Mr. Powell noted that subject to agreement with Government, the Company will introduce its Customer Owned Renewable Energy (CORE) and Utility Owned Renewable Energy (UORE) programs this year. These programs will allow our customers to connect Photo Voltaic (PV) systems to the electricity grid.

 

The Company’s CEO went on to say, “we are experiencing obstacles from the Government’s Planning Department that will make the development and possible deployment of wind energy technology in the Turks and Caicos Islands almost impossible, and unless these barriers are overcome, they will bring our planned wind initiatives to a halt.”

 

Looking ahead, fuel prices remain volatile. As usual, customers are encouraged to practice good energy saving habits.

 

Notes to Editors:

1) FortisTCI Limited (FTCI) became a wholly owned subsidiary of Fortis Inc. located in Newfoundland, Canada in August 2006. Turks and Caicos Utility Limited (TCU), which is the sole provider of electricity on the Islands of Grand Turk and Salt Cay, was acquired by FTCI in August 2012. FTCI is the sole provider of electricity in Providenciales, North Caicos, Middle Caicos, East Caicos and adjacent Cays, and South Caicos. Together the two companies serve more than 13,000 electricity customers in the Turks & Caicos Islands. The Utilities have an aggregate diesel-fired generating capacity of approximately 75 megawatts. Additional information on FortisTCI can be accessed at www.fortistci.com.

 

2) Fortis is a leader in the North American electric and gas utility business, with total assets of more than $26 billion and fiscal 2014 revenue of $5.4 billion. Its regulated utilities account for approximately 93% of total assets and serve more than 3 million customers across Canada and in the United States and the Caribbean. Fortis owns non-regulated hydroelectric generation assets in Canada, Belize and Upstate New York. The Corporation's non-utility investment is comprised of hotels and commercial real estate in Canada. For more information,visit www.fortisinc.com or www.sedar.com

 

CONTACT:

Allan Robinson
VP, Customer & Corporate Services
FortisTCI Ltd
Tel: 649-946-4313 Ext. 2507
Email: arobinson@fortistci.com