The Regulatory Authority of Bermuda has begun reviewing the payments to compensate renewable energy producers for the excess power they put back into Belco’s grid.

The authority, which regulates the electricity sector, aims to have the feed-in tariffs set next year. The start of the review process follows on from the delivery of the feed-in tariff methodology which can be viewed on the RAB website at https://rab.bm/electricity-administrative-determinations/.

An FIT is a payment for excess electricity generated and fed into the grid. In Bermuda, these are primarily small-scale solar customers although they can also include wind or other renewables generators.

Belco pays producers an amount equivalent to the avoided cost — what it would cost Belco to produce the same quantity of electricity.

When the FIT is determined, producers will be paid the updated tariff.

The review process begins with the collection of economic, technical and policy data from sectoral participants including Belco, the renewables industry, and government departments.

Aaron Smith, interim chief executive officer of the RAB, said: “We are pleased to be one step closer to determining a FIT for Bermuda’s distributed generators. Homeowners producing renewable energy are keenly anticipating the FIT and with the methodology now complete, we are that much closer.”

Requests for data have been issued to the parties directly, including inputs on the impact of renewable distributed generation on corporate profit and tax revenues, social engineering policies and emission reduction data. The authority will assess the inputs to determine the amount.

The FIT is designed to meet a number of goals, including economic, industrial, social and environmental objectives.

The National Electricity Sector Policy of Bermuda recommends that the tariff: “Ensures cost recovery by reflecting the electric utility’s cost of providing services to distributed generators (energy, demand, and grid access services), and fairly compensates distributed generators for the value of any energy produced by their distributed generation system. This may be set to reflect financial value (according to avoided generation cost), as well as economic value (accounting for externalities and benefits not captured in avoided cost).”

The authority expects to complete the review and publish the FIT during the first half of 2019.

The FIT will be reviewed and updated by the Authority every three years.