How GEBE is charging us twice for the same fuel...through the water bill

GREAT BAY--The redacted GEBE tariffs report compiled by RAC-BTP is quite a document when you take time to read it. While the focus is always on electricity, allow us to explain how you are paying fuel clause indirectly for water, even though in theory it's supposed to be applied to residential water consumers and it's not reflected on your water bill. We will do it in the simplest terms.

Read all the way through.

Imagine you pay for groceries at the store, and inside that bill is a charge for the fuel the store’s delivery truck used to bring the food from the port to the store. Fair enough. But then you go to a restaurant that buys its food from the same store, and the restaurant also charges you a “fuel delivery fee”, even though the cost of that fuel was already covered in the grocery bill. You’ve just paid twice for the same gas.

That, in very simple terms, is what’s happening with GEBE’s water bills. It's happening with electricity too, but the water is what many people totally ignore.

Here’s how it works:

1. GEBE buys fuel (diesel) from SOL to run its power plant in Cay Bay.

2. That fuel is used to make electricity. Part of that electricity goes to homes and businesses. Another part is sent to Seven Seas, the company that runs the island’s desalination (water) plants.

3. Seven Seas uses that electricity to turn seawater into drinking water, which GEBE then delivers to us.

The cost of the fuel to make that electricity is already passed on to all of us through the electricity fuel clause, the part of your light bill that changes every month.

But here’s the kicker: there’s also a fuel clause on the water bill (for commercial users), which is meant to cover the “fuel cost” of making water. Except desalination plants don’t burn fuel themselves, they use electricity, which we’ve already paid for in the electricity fuel clause.

So the same fuel cost, the diesel burned at Cay Bay to make electricity for Seven Seas, is being charged twice:

• Once in the electricity fuel clause.

• Again in the water fuel clause.

𝐁𝐮𝐭 𝐰𝐡𝐚𝐭 𝐚𝐛𝐨𝐮𝐭 𝐭𝐡𝐞 𝐰𝐚𝐭𝐞𝐫? 𝐇𝐨𝐥𝐝 𝐮𝐩 - 𝐋𝐞𝐭𝐬 𝐛𝐫𝐞𝐚𝐤 𝐭𝐡𝐚𝐭 𝐝𝐨𝐰𝐧 𝐞𝐯𝐞𝐧 𝐦𝐨𝐫𝐞:

According to the report, domestic 𝘸𝘢𝘵𝘦𝘳 customers don’t get charged a fuel clause at all. The water “fuel charge” only applies to:

• Commercial customers

• GEBE’s own consumption

• Certain negotiated contracts

Residential/domestic users pay a fixed per-cubic-meter water rate based on usage brackets, but no monthly fuel surcharge is added to their bill (hold that thought). This means the double-charging problem mainly affects:

• All electricity customers (because the electricity fuel clause already includes the cost of powering Seven Seas), and

• Commercial water customers (because they get hit with a second “fuel clause” on their water bill for the same fuel cost).

𝐀𝐍𝐃 𝐀𝐆𝐀𝐈𝐍...𝐅𝐎𝐂𝐔𝐒!...𝐋𝐞𝐭𝐬 𝐛𝐫𝐞𝐚𝐤 𝐢𝐭 𝐝𝐨𝐰𝐧 𝐌𝐎𝐑𝐄

BUT...even though domestic water users never see a “fuel clause” line on their water bill, they still indirectly pay for it.

Here’s why:

The electricity fuel clause already includes the cost of supplying electricity to Seven Seas for making all the island’s drinking water, domestic and commercial. That means every electricity customer, whether they’re a homeowner or a business, is paying for the diesel used to run Cay Bay’s generators for all water production.

When commercial water users pay a separate fuel clause on their water bill, that’s essentially charging that same fuel cost again, but the first charge in the electricity tariff wasn’t removed.

Since GEBE’s finances are a single pot, the extra revenue from this “double” allocation influences how costs are distributed overall. That can keep the electricity fuel clause higher than it should be, 𝘸𝘩𝘪𝘤𝘩 𝘢𝘧𝘧𝘦𝘤𝘵𝘴 𝘢𝘭𝘭 𝘦𝘭𝘦𝘤𝘵𝘳𝘪𝘤𝘪𝘵𝘺 𝘤𝘶𝘴𝘵𝘰𝘮𝘦𝘳𝘴, 𝘪𝘯𝘤𝘭𝘶𝘥𝘪𝘯𝘨 𝘩𝘰𝘶𝘴𝘦𝘩𝘰𝘭𝘥𝘴.

𝐈𝐧 𝐬𝐡𝐨𝐫𝐭:

• If you have a light bill, you’re paying the fuel cost for water production.

• If you’re a commercial water customer, you’re paying it twice.

• If you’re a residential water customer, you’re still paying it once through your electricity bill, 𝘦𝘷𝘦𝘯 𝘵𝘩𝘰𝘶𝘨𝘩 𝘵𝘩𝘦𝘺 𝘴𝘢𝘺 𝘺𝘰𝘶 𝘢𝘳𝘦 𝘯𝘰𝘵 𝘢𝘯𝘥 𝘦𝘷𝘦𝘯 𝘵𝘩𝘰𝘶𝘨𝘩 𝘪𝘵’𝘴 𝘯𝘰𝘵 𝘰𝘯 𝘺𝘰𝘶𝘳 𝘸𝘢𝘵𝘦𝘳 𝘣𝘪𝘭𝘭.

It’s like everyone is chipping in for the fuel to run the water factory, but some people are being asked for a second donation, and the first donation never went down for anyone else.

Got it?

The report makes it clear this is not how it’s supposed to work. It’s called a lack of “cost causality,” meaning costs aren’t being matched to the service that actually caused them. In a fair system, the fuel costs for making electricity for Seven Seas should be taken out of the electricity fuel clause and only appear in the water tariff. 𝘛𝘩𝘢𝘵 𝘸𝘢𝘺, 𝘺𝘰𝘶 𝘱𝘢𝘺 𝘧𝘰𝘳 𝘧𝘶𝘦𝘭 𝘵𝘰 𝘮𝘢𝘬𝘦 𝘸𝘢𝘵𝘦𝘳 𝘰𝘯𝘤𝘦, 𝘯𝘰𝘵 𝘵𝘸𝘪𝘤𝘦.

𝐓𝐡𝐞 𝐞𝐱𝐩𝐞𝐫𝐭𝐬 𝐚𝐭 𝐑𝐀𝐂-𝐁𝐓𝐏 𝐫𝐞𝐜𝐨𝐦𝐦𝐞𝐧𝐝 𝐆𝐄𝐁𝐄 𝐟𝐢𝐱 𝐭𝐡𝐢𝐬 𝐛𝐲:

According to RAC-BTP, The current ‘fuel clause’ formula as part of water tariffs for commercial consumers, is based on fuel prices multiplied by a factor of 1.5%. No explanation is given regarding the rationality of this formula. It is therefore recommended to comprehensively revise the tariffs for potable water, since there is clear lack of transparency and cost causality, and the current formula used for the fuel clause could not be validated. As such revisions may significantly impact all consumer groups, a careful, data-driven approach is necessary, preceded by an in-depth impact analysis.

• Calculating the real electricity cost of supplying Seven Seas.

• Subtracting any payments Seven Seas already makes for that electricity.

• Using that net figure to set the water fuel clause.

• Removing those costs from the electricity fuel clause entirely.

Until that happens, it’s like we’re paying for the same tank of gas twice, once when it’s pumped into the truck, and again when the groceries arrive.