Fuel Factor Rate Set to Climb Amid Global Fuel Price Surge and Middle East Tensions

Pelican Energy TCI is warning customers to prepare for higher electricity bills in the coming months as escalating global fuel prices, driven in part by ongoing conflict and instability in the Middle East, are expected to significantly increase the fuel factor rate charged on electricity consumption.

Devon Cox, CEO of Pelican Energy

The utility company said the fuel factor rate is projected to rise from approximately $0.1751 per kilowatt-hour (kWh) to an estimated $0.3112 per kWh, potentially adding between $15 and $140 per month to residential electricity bills, depending on energy usage and the final fuel factor rate applied.

According to Pelican Energy TCI, the increase is tied directly to rising international fuel costs and disruptions affecting global fuel supply chains and energy markets.

The company noted that the projection is based on current market conditions and available information. While the final rate may vary slightly across service territories, customers in South Caicos are expected to see the higher fuel factor rate reflected in bills issued at the end of June, while customers on all other islands will experience the increase in bills at the end of July.

Pelican Energy emphasized that the increase is not the result of changes to its base electricity rates or utility pricing decisions. Instead, the fuel factor rate fluctuates according to the cost of fuel purchased to generate electricity.

“Fuel factor rates on customer bills rise when global fuel prices rise and decrease when prices fall,” the company explained. “Because fuel is purchased in advance to ensure a stable electricity supply, changes in international fuel prices can take several weeks to be reflected on customer bills.”

The projected increase also comes during the summer months, a period when electricity consumption typically rises due to greater demand for air conditioning and cooling. The company is encouraging households and businesses to adopt energy-saving practices to help reduce the impact on monthly bills.

Pelican Energy TCI President Devon Cox acknowledged the challenges facing residents and businesses as energy costs climb.

“We recognize the challenges that rising fuel prices place on households and businesses, particularly at a time when cost-of-living concerns remain front of mind,” Cox said. “We do not take these impacts lightly and remain committed to working closely with the TCI Government, our key stakeholders, and our customers. At the same time, we are accelerating efforts to diversify the Islands’ energy mix through major investments in renewable energy.”

Cox highlighted several renewable energy initiatives currently underway, including the first phase of utility-scale renewable energy installations in Providenciales, the development of new microgrids on the sister islands following the successful completion of the North Caicos solar-plus-battery project, and the continued expansion of the company’s rooftop solar partnership program.

“These investments are expected to significantly reduce reliance on imported fuel over time and help stabilize energy prices for our customers,” he added.

To assist customers in managing higher energy costs, Pelican Energy TCI announced plans to expand residential support initiatives in the coming months. These will include energy-efficiency giveaways, complimentary home energy assessments, and additional energy conservation resources.

Customers can also use the company’s new online Bill Estimate Calculator to gauge how changes in the fuel factor rate and energy consumption may affect their monthly bills. In addition, the utility is encouraging customers to register for My Online Account, a free web portal that allows users to view, track, and download their energy usage data.