Madam Speaker,
My administration is dedicated to delivering transformational change for a simple but profound reason: we believe that the scale of our ambitions should reflect the extraordinary potential of our country and our people.
When people are hurting, providing relief is the compassionate and just response. This is a core principle we will never abandon. But we are also determined to build an economy – to build a country – in which all of our citizens can thrive, and many fewer needing relief. Building an economy that offers more opportunities, opens more doors, and has more ladders to success – this vision is at the heart of everything that we do.
Building this kind of inclusive economy requires thinking beyond the short term, and it requires taking on our most difficult problems.
When we came into office, virtually everyone understood the magnitude of the fiscal and economic crisis the country was facing. Likewise, the health and educational crises, a source of heartbreak and anguish for so many, were obvious to all.
Yet even as we worked to tackle those critical challenges, we faced another crisis, less visible but just as urgent: an energy crisis.
Of course, Bahamians have long suffered from high monthly electricity bills, and blackouts were too frequent, even during the much-diminished pandemic economy.
But underneath those obvious burdens were very serious and pressing fiscal and infrastructural problems – critical elements of our outdated energy grid were in danger of collapse, diesel generators were running nonstop in the Family Islands, and BPL was overwhelmed by more than half-billion-dollar debt.
Madam Speaker,
As I said, we have very big ambitions for our country, but it was clear to me that we weren’t going to be able to build a dynamic 21st-century economy with a deteriorating 20th-century energy grid.
So, despite having multiple urgent crises to manage, we decided to take it all on – and as a result, for the first time, our country has a comprehensive, nationwide plan to modernize and upgrade he way we generate, store, and distribute electricity, across our entire archipelago.
We are building a New Energy Era in The Bahamas – with cleaner fuels, with modern infrastructure, and with utility-scale solar power.
Today, it is my honour to share in this House updates regarding the progress of our New Energy Era reforms.
The key elements of our reforms have been posted on our website for nearly a year – I encourage Bahamians to go to the Office of the Prime Minister’s website, and look for the New Energy Era section, where we will continue to provide news and updates.
I know that some of the details can get technical, but we want everyone to see the depth and breadth of the changes that are underway. Some governmental policies affect only one segment of the population, or affect some more than others, but energy reform affects everyone. These reforms are designed to bring more affordable, more reliable energy to every Bahamian household and every Bahamian business on virtually every island in our archipelago.
The strides we are making now, including those to integrate solar energy, are just the start. As we continue to bring down energy costs for Bahamians, we will see economic growth across our islands.
I think we all agree that unleashing our homegrown entrepreneurs is the best way to make critical progress in closing the gap between our current challenges and our exceptional potential.
Madam Speaker,
When we took office in 2021, we encountered a power grid and a power generation system on life support, barely hanging on.
BPL was drowning in over half a billion dollars of debt – and that’s not counting another $100 million dollars in unfunded pension obligations. So, effectively, our country’s power company was weighed down by more than $600 million of debt.
At the same time, engineers and energy experts projected that BPL needed more than $500 million in critical upgrades to prevent a complete, imminent, catastrophic failure of our electrical infrastructure.
BPL was running on a fragmented patchwork of 29 power stations across 17 islands, with equipment from different manufacturers and from different eras creating operational inefficiencies and a maintenance nightmare.
We know from the experience of others in our region that whole systems can and indeed do go down, and stay down, sometimes for an unthinkable amount of time. Some of BPL’s engines are so old, no one even sells the parts to fix them anymore.
So there’s BPL – staggering under an unsustainable debt – yet more than 60% of the generation equipment in New Providence needed to be replaced and modernized. And our Family Islands were in even worse shape. 80% of our Family Island equipment needed to be replaced within five years.
In New Providence alone, at least 200 megawatts of new generation is needed to replace 113 megawatts of rental generation, to substitute 90 megawatts of struggling, obsolete machinery, and to accommodate growth as our economy and population expand.
Rising temperatures and increased energy demand have seen BPL reach peak loads of 281 megawatts in New Providence during 2023. And looking ahead, our forecast shows that by 2036, our energy requirements will top 435 megawatts, creating a potential shortfall of over 148 megawatts – if nothing is done.
In our Family Islands, we need at least another 100 megawatts to replace 32 megawatts of rental generation, modernize obsolete equipment, and prepare for development and growth as unprecedented levels of investment roll out across our islands.
Because BPL’s internal capacity has been limited by aging and ill-equipped engines, the government has been forced to rely on rental generation at a staggering cost of $42.7 million per year. That doesn’t make sense – it’s smarter to invest in long-term solutions instead of temporary fixes.
And of course, we inherited many other problems as well, including the inefficient, botched and bungled deployment of the Wartsilla engines, the long-promised but never-completed rate reduction bond, and the lack of substantial progress on solar energy – even as other nations in the region took steps forward during the pandemic.
Madam Speaker,
I could describe these and other problems in greater detail, but I think the scope of the challenges is clear.
And as we talk about megawatts, and engines, and power lines, we should never lose sight of what’s really at stake.
Too many families in this county have had to make the impossible choice between paying their rent or paying their light bill.
Too many businesses have incurred losses they couldn’t afford when outages damaged their equipment or spoiled their inventory.
Too many babies and elders have endured sweltering summer nights with no fans and no air conditioning when the power fails.
Too many Bahamians have delayed or cancelled their plans to buy homes, start businesses, invest in an education, or even save a few dollars, due – at least in part – to sky-high electricity costs.
This is truly unconscionable. And we won’t allow it to continue. We will not accept a status quo that is unacceptable.
Despite the many other urgent battles we needed to wage at the start of our term, we decided we couldn’t let the complexity or the difficulty of the energy crisis deter us from taking action.
Even as we lifted emergency orders, and ended lockdowns and curfews, even as we provided free testing and new health resources, even as we repaired our schools and brought our children back to the classrooms…even as we signed a record number of labour agreements, and raised the minimum wage – even as we promoted our country relentlessly, and brought in record numbers of visitors…even as we worked to successfully get our country off the blacklist – and to cut our budget deficit — we were also working to build these energy reforms.
I am so proud of my colleagues and of the many Bahamian engineers, experts, and entrepreneurs who have partnered with us to take on a challenge of this magnitude. Together, we are proving that even our toughest problems can be solved – when we show up with stubborn determination, innovative solutions and investments, and a willingness to endure more than a few sleepless nights.
Madam Speaker,
We started with a comprehensive review of our energy infrastructure and an analysis of new technologies and market conditions. To address infrastructural deficiencies, we have embarked on a multi-phase strategy aimed at modernizing our power generation and distribution systems. This includes the installation of new, high-efficiency power plants, the integration of renewable energy sources, and the overhaul and replacement of outdated machinery. Our investments in solar power technology have been substantial. We are deploying utility-scale solar panels across our islands, harnessing the power of the abundant sunlight that is one of our country’s blessings.
What makes our energy reforms revolutionary is simple: we’re doing it all, we’re doing it everywhere, and we’re doing it now.
This isn’t a piecemeal approach.
We’re not just adding a couple of engines, installing a few solar panels, or fixing a few transmission lines here and there. Band-aids and half-measures have failed us too often in the past.
Instead, we’ve designed a comprehensive transformation that invests in and modernizes our entire energy ecosystem. When you consider that we’re enacting meaningful reforms across our entire archipelago, I think we can make a case that few other countries in the world are advancing energy reforms in such an integrated, holistic way.
Solar microgrids on every major island will be integrated with cleaner fuels and modern grid technology, which will power local economies and provide reliable, affordable electricity to every Bahamian family.
Each component strengthens the others. Each element amplifies the benefits of the whole. This integrated approach unlocks unprecedented synergies that will deliver outcomes far greater than any single initiative could achieve alone.
Such significant progress would not be possible without our emphasis on partnerships.
This is not a situation in which the government could or should take the entire reform process on alone.
We have partnered with a range of Bahamian companies to make this change possible.
We’ve partnered with New Providence Gas to install our nation’s first LNG terminal.
We’ve facilitated the partnership that led to the creation of the Bahamian Grid Company – a local entity that will modernize the power grid on New Providence – in which BPL own a 40% stake. BPL will oversee grid modernization efforts on our Family Islands.
We’ve included Bahamian participation to the greatest extent possible, and where we needed international expertise or expanded access to supply chains or capital, we ensured that our international partners will work with Bahamian entities to get the job done.
Considering the complexity of our integrated energy reform plans, and considering the fast-moving technologies in renewable energy, and given the massive debt at BPL, it was critical to create strong partnerships between our local investors and international partners with the track record to ensure success.
That is why we invited some of the top energy names in the world to partner with the government, with BPL, and with diverse groups of Bahamian companies, to build our new energy future.
In total, our plans call for the construction of solar, LNG, and mixed fuel facilities on over 14 islands in our archipelago, including New Providence, Abaco and the Cays, Eleuthera, Great Exuma, Andros, Great Harbour Cay, Bimini, Harbour Island, Staniel Cay, Farmer’s Cay, San Salvador and Moore’s Island – all in partnership with Bahamian companies.
The companies taking part in these initiatives include: Madeleine Solar, Eco Energy, and CVB Utility in New Providence, EA Energy in Abaco and Eleuthera, and The Exumas Renewable Energy Corporation in Exuma.
Other Bahamian partners will be announced throughout the other islands.
BPL will continue to play a major role in managing and distributing the electricity generated by these independent power producers, as well as overseeing Family Island grid management, transmission and distribution, maintenance, and monitoring, as well as supplying supplemental generation during peak demand to ensure that our energy needs are met.
We are confident that we have designed these partnerships to deliver change for Bahamian households as quickly and comprehensively as possible.
Through a careful and deliberate selection of strategic partners and vendors, we have diversified our operational, financial and strategic risks. We are building resilience into the very fabric of our plan, positioning our reforms and our country to succeed in the widest possible range of scenarios.
Madam Speaker,
We have developed and launched the most comprehensive energy reform initiative in our nation’s history.
These New Energy Era reforms will serve as a foundation for modern life, for opportunity, and for prosperity.
We are lowering energy costs, upgrading our energy infrastructure, creating opportunities for Bahamians, and transitioning toward renewable energy.
It’s time – long past time – to end random power outages, load shedding, and catastrophic failures.
And although we are in the early stages of reform, Bahamians are already experiencing savings.
In January, more than 9,500 households had electricity bills under $20; 40,000 households paid between $20 and $99; and over 8,200 households paid between $100 and $124. In total, this means that over 62% of households had electricity bills below $125.
And this is just the beginning.
This New Energy Era will deliver increased savings for families, putting more dollars back in their pockets each month.
As additional improvements are made, electricity costs are projected to fall significantly throughout our archipelago.
That means millions of additional dollars in annual savings for our communities — in Abaco, in Eleuthera, in Exuma, in Andros–– and millions more spent in our local economies.
The savings will be welcomed by consumers, alongside other measures we’re taking to lower the cost of living in The Bahamas.
The reforms will also help BPL return to fiscal health. In fact, our integrated strategy will generate $87 million in annual savings for BPL. $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.
These savings will accumulate until BPL’s entire $500 million debt is erased. And all of the measures we’ve discussed will help BPL explore avenues to address their pension obligations.
It’s part of a virtuous cycle – as we help BPL dig out from under the crushing weight of debt, we are freeing up resources to continually invest in better service, more modern equipment, and further cost reductions that benefit every electricity consumer.
The LNG conversion alone will deliver enormous benefits. 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 – with $40 million in savings last year, ramping up to $90 million by the end of this year.
The grid modernization will also deliver savings as we build the storm-resistant, efficient, and intelligent grid of tomorrow. These grid enhancements will save $10 to $30 million annually. That money will flow back to consumers in the form of lower rates and better service.
These revolutionary transformations represent the largest coordinated energy investment in our nation’s history, including $820 million for New Providence projects and $324 million for Family Island projects.
This is a one billion dollar investment in our economy and in our future – an investment that will not just deliver financial returns, but will also improve quality of life, expand economic opportunity, and enhance our resilience.
The future of energy is unfolding right now in our islands.
In fact, by 2030, we will have 65 megawatts of solar in New Providence and 34 megawatts of new solar generation across our Family Islands, along with the existing 28 megawatts in Grand Bahama, Ragged Island, and Chub Cay.
That adds up to 128 megawatts, which means 32% of our energy needs will be met by solar power. This exceeds the global target of 30% renewable energy by 2030.
Every ray of sunshine captured is imported fuel we don’t have to buy.
BTVI has already begun training young Bahamians to enter the renewable energy sector in preparation for growth.
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.
Our energy future is bright, and it is built on the pillars of renewable energy, modern infrastructure, enhanced efficiency, and improved resilience.
Now that we’ve covered what we are doing and how we are approaching our reforms, I’m sure the next question on most people’s minds is: when is all of this happening?
The answer is: it’s already happening.
The $130 million upgrades to our grid in New Providence began this month and will be completed within 12 months.
The first phase of the LNG terminal at Clifton is set to begin before the end of this year and will cover BPL’s base load within 18 months.
And all of the solar, LNG, and mixed fuel systems being set up in collaboration with our Bahamian partners throughout our islands are scheduled to be initiated this year, and will be fully operational by the second half of 2026, delivering lower prices within 18 months and locking in those low prices for years to come.
Our energy revolution has already started, and Bahamians won’t have to wait a generation to feel the impact. But the impact will be felt for generations to come, in New Providence and in our Family Islands.
For too long, our nation has been held back by our energy woes.
Now, we’re turning those challenges into opportunities.
In doing so, we are creating a stronger, greener, more energy-secure Bahamas—a nation where the lights stay on, bills are affordable, and our infrastructure is protected for generations to come.
I am pleased to now table Securing The Bahamas’ Energy Future, which outlines the Davis Administration’s comprehensive plan to overhaul the country’s energy sector, focusing on long-term reliability, affordability, and sustainability. It details major investments in liquefied natural gas, utility-scale solar, hybrid microgrids, and grid upgrades, while introducing a new electricity pricing structure to provide relief to households.
Thank you, Madam Speaker.
May God Bless the Commonwealth of The Bahamas.