The Fair Trading Commission Act, CAP. 326B of the Laws of Barbados

• Jurisdiction: Barbados
• Judge: Sir Neville Nicholls,Dr. Philmore Alleyne,Mr. Andrew Brathwaite,Mr. Gregory Hazzard,Mr. Andrew Willoughby
• Judgment Date: 08 August 2014
• Docket Number: FTCUR/MTNDEC2014-03
• Court: Fair Trading Commission (Barbados)

In the Matter of the Fair Trading Commission Act, CAP. 326B of the Laws of Barbados;

And in the Matter of the Utilities Regulation Act, CAP. 282 of the Laws of Barbados;

And in the Matter of the Utilities Regulation (Procedural) Rules, 2003 and the Utilities Regulation (Procedural) (Amendment) Rules, 2009;

And in the Matter of the Application by the Barbados Light & Power Company Limited for a Motion for review of the Renewable Energy Rider Decision of the Fair Trading Commission dated the 8 ^th day of August, 2013.

Before:

Sir Neville Nicholls Chairman

Dr. Philmore Alleyne Commissioner

Mr. Andrew Brathwaite Commissioner

Mr. Gregory Hazzard Commissioner

Mr. Andrew Willoughby Commissioner

FTCUR/MTNDEC2014-03

FAIR TRADING COMMISSION

DECISION

PART ONE — BACKGROUND

1 In March 2010 the Fair Trading Commission (Commission), being satisfied with the conditions of the Renewable Energy Rider (RER) pilot programme as proposed by the Barbados Light & Power Company Limited (Applicant), granted approval for the use of the RER programme on a pilot basis for a period of two (2) years.

2 The RER programme was developed by the Applicant as a scheme to facilitate the sale to the grid of surplus electricity generated from customers' distributed Renewable Energy (RE) systems.

3 At the end of the pilot, the Applicant applied to the Commission for the permanent implementation of the RER programme with amended terms and conditions.

4 After a Public Consultation on the RER programme, the Commission issued its RER Decision dated August 8, 2013 (RER Decision).

Application for a Motion for review

5 The Applicant, by Notice of Motion dated and filed on December 3, 2013, applied for a review and variation of the RER Decision pursuant to Section 25 of the Utilities Regulation Act (URA) CAP. 282 of the Laws of Barbados and Section 36 of the Fair Trading Commission Act (FTCA) CAP. 326B of the Laws of Barbados.

6 The Applicant also sought an order staying the RER Decision until final determination of the Motion. A Stay of the RER Decision was granted by the Commission on January 24, 2014.

7 The Applicant in its Motion requested that the Commission review and vary the RER Decision as it relates to the requirement to use the “sale of excess” billing arrangement for all RER customers and the disallowance of the Alternative Meter Configuration 2.

8 The Applicant stated that it considered the “buy all/sell all” arrangement to be the preferred option to the “sale of excess” arrangement. However, it invited the Commission when making its decision to consider two (2) Options.

9 The two (2) Options that the Applicant requested the Commission to consider in reviewing its RER Decision are:

Option 1

“… all customers with renewable generating systems up to 2kW should have the option to choose their preferred billing arrangement and all customers with renewable generating systems above 2kW will be billed under the “buy all/sell all” arrangement.”

Option 2

“… all customers should be given the flexibility to select their preferred billing arrangement (buy all/sell all or sale of excess).”

10 The Applicant further stated that should the Commission implement Option 2 or continue with its present decision to implement “sale of excess” for all customers, then the Applicant should be granted leave to apply for an adjusted customer charge for all customers that are to be billed under the “sale of excess” billing arrangement. The Applicant stated that the adjusted customer charge that is applicable to “sale of excess” customers will incorporate the costs to provide back-up service to these customers.

The Billing Arrangements and Metering Systems

11 The “sale of excess” and the “buy all/sell all” arrangements are billing mechanisms used by the Applicant for RER customers. Electricity generated up to 1.5 times the customer's average monthly electricity consumption, is compensated on a kilowatt-hour (kWh) basis, and paid by the Applicant using the RER credit of 1.6 times the monthly Fuel Clause Adjustment (FCA) (hereinafter referred to as RER credit rate). Any electricity generated and fed to the grid in excess of this amount is compensated at the monthly FCA rate. (see Appendix for further information on the billing and metering options)

12 Under the “sale of excess” billing arrangement, an RER customer is billed at the normal rate for what he uses from the grid and is credited for the excess electricity that he sells to the grid (i.e. the electricity generated from his RE system that he did not use).

13 Under the “buy all/sell all” billing arrangement the customer is billed for all the energy consumed, regardless of the source, at the normal electricity rate, and credited for all the electricity generated from the RE system at the RER credit rate.

14 An RER customer that selects the “buy all/sell all” billing arrangement can use either Meter Configuration 1 or Meter Configuration 2. The term “buy all” relates to the total electricity consumed by the customer, that is, the electricity supplied from the grid in addition to the electricity that is supplied from the customer's RE system. The term “sell all” relates to the total amount of electricity generated from the customer's RE system.

15 With Meter Configuration 1, two (2) meters are installed on the RER customer's premises. One meter measures the output of the RER customer's generating system, while the other meter, a bi-directional meter, measures the electricity supplied from the grid to the customer and the electricity fed to the grid from the customer's RE system. A customer who selects the “sale of excess” billing arrangement must use Meter Configuration 1.

16 Meter Configuration 2 also has two meters, but neither of them is bidirectional. One meter measures the total electricity generated from the customer's RE generating system. The other measures the total electricity consumed by the customer, whether from the customer's RE system or the grid. Meter Configuration 2 cannot be used with the “sale of excess” arrangement because the readings from the meters in this configuration do not allow the calculation of the excess electricity that is fed to the grid from the RE system.

The Parties to the Hearing

17 The persons involved in the 2012 RER Public Consultation were invited to participate in the Motion for review of the RER Decision.

18 These persons were invited to inform the Commission whether they were interested in participating in the review hearing on the billing and metering arrangements of the RER Decision only, as these were the two (2) issues raised in the Motion filed by the Applicant.

19 The Commission received letters of interest from the following persons: CARITEL; Sir Allan Fields; Mr. Dick Stoute; Williams Industries Inc; the Barbados Renewable Energy Association (BREA); Mr. Aidan Rogers; Solar Watt Systems Inc. and Mr. John Hayward (all hereinafter referred to as the Parties).

20 On March 31 ^st 2014, the Commission received written submissions from: CARITEL; Sir Allan Fields; Mr. Dick Stoute; Williams Industries Inc; BREA and Mr. Aidan Rogers.

21 No written submissions were received from Solar Watt Systems Inc. or Mr. John Hayward.

22 All written submissions received were circulated among the Parties and the Applicant. The Applicant was given an opportunity to respond to these submissions and the Commission's interrogatories. The Commission's interrogatories and the Applicant's responses to the same were also circulated among the Parties.

Legislative Framework

23 By virtue of Section 36 of the FTCA and Rule 53 of the Utilities Regulation (Procedural) Rules (URPR) Statutory Instrument 2003 No. 104 of the Laws of Barbados, the Commission has jurisdiction on an application from a party or on its own motion to review, vary or rescind any decision given by it. In instances where the Commission allows a review, the process is prescribed by the Rules. The Commission's power to review and vary or rescind a decision or order is exercised in accordance with due process.

24 Under the FTCA, the authority of the Commission to allow a review is discretionary. An applicant must first demonstrate, on a prima facie basis, the existence of the permissible grounds of review — the threshold question.

25 Rule 54 (1) of the URPR sets out specific grounds on which the Commission can review a decision made in a utility regulation proceeding. Rule 54 (1) of the URPR states that:

“ (1) Every Notice of Motion made under Rule 53 (2), in addition to the requirements of Rule 8 shall

• (a) Set out the grounds upon which the motion is made sufficient to justify a review or raise a question as to the correctness of the order or decision and the grounds may include

  • (i) error of law or jurisdiction;

  • (ii) error of fact;

  • (iii) a change in circumstances;

  • (iv) new facts that have arisen;

  • (v) facts that were not previously placed in evidence in the proceedings and could not have been discovered by reasonable diligence at the time;

  • (vi) an important matter of principle that has been raised by the order or decision;”

26 In the Motion for review, the Applicant relied on Rule 54 (1) (a) (vi) “ an important matter of principle that has been raised by the order or decision” as the ground for review.

27 The URPR further stipulates that the Commission must determine the threshold question with a hearing. Rule 55 (1) of the URPR states that:

“ (1) The Commission shall determine with a hearing, in respect of a motion brought under rule 53 the threshold question of whether the matter should be reviewed or whether there is reason to believe the order should be rescinded or varied.”

28 In accordance with Rule 55 (3) of the URPR the Commission decided that it would hold a consolidated hearing by combining the consideration of the threshold question and the review on the merits. Rule 55 (3)...