Electricity subsidies are unsustainable, gov’t told

The National Democratic Party (NDP) has warned that the government’s continued subsidisation of electricity costs is unsustainable, calling for long-term solutions to reduce energy expenses and provide lasting relief to consumers in the Virgin Islands.

NDP Chairman Marlon Penn said the territory cannot continue relying on government subsidies to cushion residents against rising electricity bills and must instead address the underlying factors driving energy costs.

Speaking on NDP Radio on Wednesday, Penn acknowledged the government’s recent decision to extend electricity relief until December but argued that temporary financial assistance would not resolve the problem.

“And the subsidies cannot continue, it’s not sustainable. We have to look at a long-term solution for the electric corporation to give the people of this territory some level of relief,” Penn stated.

The opposition leader identified fuel storage and renewable energy as two areas requiring attention.

Penn said the BVI Electricity Corporation currently purchases fuel monthly because the territory lacks sufficient storage capacity to purchase and retain larger quantities.

“One of the things we’ve discussed and we’re looking at is the whole issue of procuring additional storage so that you can lock in the price of fuel where you could then know there’s some certainty in pricing,” Penn explained.

He also proposed expanding renewable energy production, particularly on Anegada, and exploring opportunities to extend renewable energy systems to Virgin Gorda and Jost Van Dyke.

“But we have to think outside the box. We have to think consistently in terms of how we’re going to fix the problem, because we cannot continue to subsidise the fuel costs,” Penn stated.

The NDP chairman said his party had been consulting industry professionals and developing proposals to address the territory’s infrastructure challenges, including electricity generation and distribution.

He pledged that an NDP administration would pursue measures to manage fluctuations in electricity costs and provide more predictable bills for households.

Penn’s comments followed the government’s announcement of a further $2.5 million in electricity subsidies through December. Communications and Works Minister Kye Rymer announced the allocation last month after residents complained about sharply increased electricity bills.

Rymer previously acknowledged that repeatedly subsidising imported diesel was unsustainable and identified the government’s Solar Technology Energy Programme as part of its long-term response.

Meanwhile, NDP At-Large Representative Ronnie Skelton warned that electricity generation presented a complex challenge because the territory depends on imported fuel.

He cautioned that prolonged financial pressure on the electricity corporation could affect its ability to maintain equipment and purchase spare parts.

Skelton called for a phased transition to renewable energy, supported by a national plan that successive administrations would follow.