BESolar's NESP 2026 Public Consultation Submission

Dear Minister,

Since BE Solar’s founding, we have designed and installed solar systems for more than 850 households and businesses across this island, employing a team of 15 Bermudian and Bermuda-based professionals. We have direct, operational experience of distributed energy generation in Bermuda's specific environment, regulatory framework, and grid conditions. We submitted a detailed Alternative Proposals response to the IRP consultation process in September 2025. We are submitting this response to the NESP 2026 consultation because the decisions made through this process will shape Bermuda's energy system, and every Bermudian's electricity bill, for a generation.

We want to be clear at the outset about where we stand. BE Solar is not opposed to BELCO. We are not opposed to examining all available options. We are not submitting this response to protect our commercial interests. We are submitting it because we believe the evidence points clearly in a direction that this policy has not yet fully reflected, and because we believe Bermudians deserve to have that evidence presented clearly before this consultation closes.

We also want to acknowledge and commend what we believe the Government has got right. The NESP's 59% renewable energy target is ambitious and correct. The identification of the Fuel Adjustment Rate as the central driver of bill variability is accurate and forms the foundation of our own analysis. The policy's support for EV integration, battery storage, and Building Code reform reflects exactly the kind of forward-looking thinking Bermuda needs. These are the right instincts. Our submission is offered in the spirit of ensuring the policy delivers on them.

We also want to be clear about who we are as a company beyond our commercial activity. Over the years, BE Solar has co-funded and supported numerous charities, non-profit organisations, schools, and community groups across this island. We genuinely believe that businesses operating in Bermuda have a responsibility to contribute to the community they serve. That same belief drives our engagement with this consultation. We share the Government's goal of making clean, affordable energy accessible to every Bermudian, and we are committed to working as a partner, not just an advocate, to help make that happen.

1. THE PRIMARY CAUSE OF RISING BILLS HAS NOT BEEN CORRECTLY IDENTIFIED

The NESP 2026 identifies the growth of distributed generation as a significant contributor to rising electricity tariffs. BE Solar's analysis, supported by BELCO's own published data, does not support this conclusion.

Distributed solar generation currently produces approximately 18,600 MWh per year across the island, representing roughly 3% of Bermuda's total annual electricity consumption of approximately 598,000 MWh. At that scale, distributed solar cannot be the primary driver of the tariff pressures Bermudians are experiencing.

The structural causes of declining kilowatt-hour sales are more significant and have received insufficient attention in the policy process. Bermuda's resident population has been declining, with multiple estimates suggesting the actual resident population may be materially below official figures. The prolonged closure of the Fairmont Southampton Princess and Elbow Beach, representing an estimated 10 GWh per year of stable commercial demand, has removed two of the island's largest electricity customers from the grid. Island-wide energy efficiency improvements, driven partly by high electricity costs themselves, have reduced consumption faster than planning models anticipated. Bermuda's actual 2022 electricity sales of 585 GWh were already below conservative proj ections of 639 GWh.

When fewer customers share the same fixed infrastructure costs, tariffs rise. This is the core dynamic driving Bermudian electricity bills, and it is a structural demand challenge that requires a structural policy response. We urge the Ministry to commission and publish a transparent, disaggregated analysis of demand drivers before finalising any policy. Bermudians deserve this transparency, and the Government is well placed to provide it.

We strongly support the Government's commitment to understanding and addressing the real drivers of energy cost for all Bermudians, particularly those on fixed and lower incomes for whom electricity is not a discretionary expense. This is a shared goal, and we are ready to contribute to the analysis.

The Fuel Adjustment Rate remains the single largest driver of bill variability and is the mechanism by which global fossil fuel price movements reach every Bermudian electricity customer directly. Any energy policy that does not reduce Bermuda's exposure to this mechanism is not solving the affordability problem. It is rearranging it.

2. LNG HAS BEEN EXAMINED BY BERMUDA'S OWN EXPERTS, TWICE, AND BOTH TIMES THE CONCLUSION WAS THE SAME

BE Solar notes with concern that the NESP 2026 reopens the question of Liquefied Natural Gas as a primary generation fuel at a point when Bermuda has already invested significantly in answering that question through two rigorous, independent processes.

The 2019 Regulatory Authority’s approved Integrated Resource Plan evaluated eight energy scenarios in detail, using Bermuda-specific consumption data and independently verified modelling. It selected the non-LNG path, targeting 85% renewable electricity by 2035. The IRP explicitly warned that an LNG commitment "would influence energy policy and prices for up to 50 years into the future." Its own sensitivity analysis found that LNG's projected cost advantage over the non-LNG scenario was approximately 6% under base case assumptions, and that a 25% increase in LNG infrastructure or commodity costs would eliminate that advantage entirely.

BELCO's own 2024 IRP Preferred Plan, independently reviewed by the University of Edinburgh and Black and Veatch, reached the same conclusion. It selected Portfolio P4L, comprising solar, battery storage, and offshore wind, explicitly rejecting LNG as carrying unacceptable deployment risk. BELCO's own published generation cost data shows onshore solar at $0.072/kWh, the cheapest generation technology available to Bermuda by a significant margin.

The history of the North Power Station provides important context that is absent from the NESP 2026. Documents released under Bermuda's Public Access to Information Act and reported by the Royal Gazette in August 2025 confirm that the Regulatory Authority's March 2018 approval order covered diesel-configured dual-fuel engines, with gas conversion described as a future possibility subject to LNG policy approval. BELCO subsequently modified the engine specification to optimise for LNG without disclosing this change to the RA, which only learned of it through the media. When LNG was rejected in the 2019 approved IRP, running LNG-optimised engines on heavy fuel oil caused significant soot and emissions problems across the island. A $2.4 million retrofit was required. BELCO attempted to recover those costs from electricity customers. The Supreme Court of Bermuda rejected that recovery. The Regulatory Authority described the expenditure as imprudent.

Bermuda has already absorbed the financial legacy of one LNG plan that the Regulatory Authority rejected. This pattern, infrastructure built ahead of policy approval, approval denied, costs incurred, costs disputed, should inform the current deliberation.

BE Solar respectfully asks the Ministry to identify and publish what new evidence has emerged since 2024 that justifies reopening a conclusion that independent experts, using Bermuda's own data, reached twice.

3. LNG CARRIES FINANCIAL RISKS THAT COMPOUND OVER DECADES

Beyond the policy history, the financial structure of an LNG commitment warrants careful scrutiny.

A 2018 engineering study referenced in the IRP Consultation Responses estimated at least $140 million for the gasification plant, LNG tanker terminals, storage, and pipeline infrastructure required to operate on LNG. A 2016 Castalia consultancy report estimated the full cost of switching Bermuda's generation to LNG at between $258 million and $315 million. Combined with the $120 million North Power Station already on the books, Bermuda is looking at a capital commitment of at least $260 million before a single unit of LNG-generated electricity reaches a Bermudian home. All prior estimates are now several years old and significantly understate current costs following global inflation and supply chain disruption.

Under Bermuda's regulatory framework, every dollar of approved capital earns a guaranteed return recovered from electricity bills for the operational life of the asset, potentially 30 to 50 years. Every dollar committed to LNG infrastructure will earn its regulated return from Bermudian ratepayers regardless of whether cheaper alternatives emerge during that period, and regardless of what global LNG prices do over the intervening decades.

Global LNG prices are not stable. The 2026 Iran conflict and Strait of Hormuz closure, characterised by the International Energy Agency as the largest supply disruption in the history of the global oil market, caused LNG prices in Asia and Europe to rise 54% and 63% respectively within a single week. Bermuda would not source LNG from Qatar directly, but LNG is priced in interconnected global markets. A disruption affecting 20% of global LNG supply raises costs for every buyer regardless of their specific supply source. The Fuel Adjustment Rate would transmit those movements directly to every Bermudian electricity customer.

The Rocky Mountain Institute's structural analysis of LNG in small island electricity systems identified what it called the scale trap: islands cannot achieve the economies of scale that make LNG competitive in industrial markets, and therefore pay a disproportionately large capital cost for relatively small generation capacity. Furthermore, as Bermuda deploys more renewable generation, the volume of LNG required decreases. LNG contracts and delivery economics become progressively less favourable as volume falls. Capital committed to LNG does not just lock Bermuda into fossil fuel costs. It creates a structural financial disincentive against the very renewable transition the policy is simultaneously trying to achieve.

Bloomberg NEF's Levelized Cost of Electricity 2026 report found that the global benchmark cost for a four-hour battery storage project fell 27% in a single year to $78/MWh, a record low. New-build gas plant costs simultaneously rose to $102/MWh, a record high. Battery storage is now cheaper to build than a new gas plant. Co-located solar and four-hour battery storage delivered power at an average of $57/MWh in 2025. The economic case that appeared to make LNG competitive in 2019 no longer exists in 2026.

4. LNG PRESENTS SAFETY, SITING, AND OPERATIONAL RISKS THAT THE NESP 2026 HAS NOT ADDRESSED

Before Bermuda commits to any LNG pathway, several fundamental questions deserve public answers. The NESP 2026 does not provide them. BE Solar believes they must be answered before any policy commitment is made.

Where exactly would this infrastructure go?

The North Power Station sits on Serpentine Road in Pembroke Parish, close to the capital Hamilton, in a densely populated residential and commercial area. Any LNG regasification facility serving that station would need to be in close proximity to it, either onshore in the same neighbourhood or offshore in the adjacent waters.

The NESP 2026 contains no specification of where LNG import, storage, and regasification infrastructure would be sited. On a 21-square-mile island with no industrial periphery, no remote coastline, and no uncommitted deep-water port, that is not an administrative detail. It is the central question. There is no location in Bermuda that is not someone's backyard, someone's harbour view, someone's front door.

The Minister of Home Affairs made this point herself this week, noting that delivering LNG to the island would require roads to be dug up to install new pipelines, describing it as "a costly enterprise." That observation barely scratches the surface of the siting challenge.

Would this be a floating regasification unit moored in our waters?

For small islands without existing gas infrastructure, the most common LNG delivery model involves a Floating Storage and Regasification Unit, an FSRU: essentially a large industrial vessel permanently moored nearshore that receives LNG from supply tankers and converts it back to gas for delivery to the power station via submarine or land pipeline.

The NESP does not specify whether this is the model being considered for Bermuda. If it is, Bermudians should understand what that means in practice: a large industrial vessel permanently anchored in Bermudian waters, receiving regular LNG tanker deliveries, operating cryogenic processing equipment in a marine environment, and requiring navigational exclusion zones around it. Hamilton Harbour, the Great Sound, and the surrounding waters are shared by cruise ships, ferries, pleasure craft, and the commercial vessels that supply this island. The coexistence of LNG infrastructure with Bermuda's marine traffic, tourism economy, and coastal communities is not a resolved question. It is a fundamental one that the NESP has not asked.

What are the specific safety risks?

LNG is stored and handled at approximately minus 162 degrees Celsius. Safety literature on FSRU operations identifies primary hazard categories as pool fire, flash fire, rapid phase transition, and LNG rollover, a phenomenon in which sudden pressure buildup in storage tanks can exceed vessel capacity. Each of these scenarios requires dedicated emergency response capability: specialist equipment, trained personnel, and established protocols that do not currently exist on this island in any meaningful form.

LNG facilities in populated areas require safety exclusion zones that constrain surrounding land use and require community evacuation planning. On a 21-square-mile island, the implementation of meaningful exclusion zones around LNG infrastructure would have direct implications for adjacent residential and commercial properties, proximity to Hamilton's working waterfront, and access to surrounding coastal areas. The NESP 2026 contains no analysis of these implications.

Bermuda sits squarely in the Atlantic hurricane belt and experiences one of the most corrosive marine environments on earth for metal infrastructure. LNG terminal locations at coastal regions face documented exposure to severe weather conditions, and environmental concerns including potential gas leaks and their impact on marine ecosystems are a consistent challenge for coastal LNG operations globally. The maintenance requirements for cryogenic LNG infrastructure in Bermuda's specific conditions would be substantial, the inspection and certification regime intensive, and the consequences of infrastructure failure in a populated harbour environment serious.

What specialist workforce would be required, and at what ongoing cost?

LNG facilities require internationally certified cryogenic and gas engineering professionals for safe operation. These specialists do not currently exist in Bermuda's labour market. They would need to be recruited internationally, compensated at rates commensurate with their specialist qualifications, housed on the island, and retained for the full operational life of the infrastructure. This is not a one-time recruitment exercise. It is a permanent, ongoing operational cost that must be factored into any honest cost comparison and would be recovered from Bermudian ratepayers through the tariff indefinitely.

What does comparable small-island experience tell us?

The Bahamas, a small island nation facing comparable energy infrastructure challenges, has been attempting to establish LNG import capability for power generation since at least 2016. Multiple consultancy engagements, multiple proposals, and multiple changes of direction later, as of mid-2024 Shell had moved away from its planned terminal at Clifton Pier. A decade of effort and still no LNG. The structural complexity of delivering small-scale LNG to a small island is not simply an engineering problem that sufficient capital can solve. It is a persistent challenge that the NESP 2026 has not adequately reckoned with.

What BE Solar is asking on this point

We are not asserting that LNG cannot be made to work in Bermuda. We are asserting that the NESP 2026 has not answered the basic questions any responsible decision-maker should require before committing public infrastructure of this scale. Where will the regasification infrastructure be located? Is an FSRU the proposed model, and if so what are the implications for our harbours and marine traffic? What safety exclusion zones would be required and which communities fall within them? What is the full operational lifetime cost of the specialist workforce required? What is Bermuda's emergency response plan for an LNG incident and what investment would be required to make that plan credible? What is the environmental risk assessment for LNG infrastructure in Bermuda's specific hurricane-exposed, highly corrosive marine environment?

These questions have answers. They require genuine analysis and full public transparency. Until that analysis is published, any commitment to LNG infrastructure is a commitment made without the information Bermudians deserve.

5. ENERGY EQUITY REQUIRES INVESTMENT IN ACCESS, NOT RESTRICTION OF THE CHEAPEST TECHNOLOGY

BE Solar shares both the Government's concern and its stated ambition: that the benefits of clean energy should reach every Bermudian, not just those who can afford a rooftop installation.

This is not a position we hold in the abstract. We have invested our own resources and worked with community and private sector partners to fund solar installations for charities, schools, non-profit organisations, and community groups across this island. We believe that a Bermuda where clean energy is genuinely accessible to all is not just a more equitable Bermuda. It is a stronger, more resilient, and more prosperous one.

Solar generates 3% of Bermuda's electricity. The cost pressures facing low and middle income Bermudians are driven by structural demand decline and volatile fossil fuel prices, not by panel owners. Restricting the cheapest generation technology available does not lower bills for those who cannot afford solar. It removes the most viable pathway to lowering those bills for everyone.

The right response to energy equity is policy that actively extends clean energy access to those who currently cannot afford it. Government-backed financing that enables low and middle income homeowners to install solar systems with no upfront capital, repaid through bill savings over time. Community solar programmes that allow renters and apartment dwellers to subscribe to shared generation and receive direct bill credits. Time-of-use tariffs and demand response programmes that return money to the most cost-conscious consumers. Energy efficiency programmes targeted specifically at the households carrying the highest energy cost burden relative to their income.

High energy costs are a poverty issue. Locking in decades of expensive, complex fossil fuel infrastructure does not solve that. It compounds it.

BE Solar formally offers to work with this Government and the Regulatory Authority to design and deliver programmes of this kind. We have the technical expertise, the operational infrastructure, and the genuine commitment to make them work. Expanding clean energy access to every income level is not just an equity imperative. It is the most effective long-term strategy for reducing the energy cost burden on Bermudians who need relief most.

This offer is not theoretical. We have already demonstrated, through our own community investments and partnerships, that we are willing to direct resources toward Bermudians who need support rather than those who simply want a better return on capital. We look forward to the opportunity to bring that same commitment in designing energy access solutions for those who need them most.

6. BERMUDA'S EXISTING INFRASTRUCTURE ALREADY SUPPORTS SMARTER ALTERNATIVES

BELCO has completed its advanced metering rollout across the entire island. The data infrastructure required for time-of-use pricing, demand response, and Virtual Power Plant coordination is already in place. This is a significant and underutilised asset.

At 25% EV adoption, approximately 5,600 vehicles, Bermuda's fleet holds an estimated 56 MWh of available distributed storage based on a conservative 10 kWh of usable headroom per vehicle. That is already 1.4 times BELCO's planned 40 MWh grid battery investment, distributed across the island rather than concentrated at a single site. Hawaiian Electric, operating a comparable isolated island grid, demonstrated 40 MW of grid services from residential batteries, eliminating equivalent new generation investment. The hardware foundation for a Bermudian Virtual Power Plant already exists. What is missing is the software platform and regulatory framework to activate it.

AI-optimised grid management platforms are operating commercially at utility scale globally. They can be delivered under software-as-a-service models with minimal capital requirements, typically cost-justified within 12 to 18 months on fuel savings alone. Rather than viewing distributed energy resources as a challenge to grid stability, Bermuda has an immediate opportunity to orchestrate them as actively managed grid assets that reduce fuel consumption, moderate peak demand, and defer infrastructure investment.

7. WHOSE INTERESTS DOES THIS DECISION SERVE?

BE Solar supports BELCO succeeding as a utility. A well-run grid is essential to everything we are trying to achieve on this island, and we recognise the genuine difficulty of operating electricity infrastructure in Bermuda's conditions.

But a utility's financial incentives and Bermuda's national energy interests are not automatically the same thing, and this policy moment requires the Government to be clear about which it is serving.

BELCO's regulatory model rewards capital deployment. LNG requires enormous capital. The math is not complicated. What is being asked of Bermudians is to lock in to decades of fossil fuel infrastructure costs, fuel price exposure, and specialist operational complexity, so that a regulated monopoly can deploy more capital and earn more guaranteed return.

That is not an energy transition. That is the opposite of one.

8. BERMUDA'S RENEWABLE AMBITIONS DESERVE IMPLEMENTATION TOOLS, NOT A POLICY REVERSAL

Bermuda's own modelling demonstrates that 59% renewable electricity is achievable. BELCO's own 2024 preferred plan demonstrates that 82% carbon reduction is achievable while maintaining grid reliability, without LNG. The tools to get there exist today: solar at $0.072/kWh, battery storage at record low cost, island-wide smart meters, and a regulatory framework that can be adapted to enable time-of-use pricing and distributed resource coordination.

What has consistently been absent is the implementation framework; land-use planning that enables utility-scale renewable generation; a grid storage roadmap with defined milestones; tariff reform that shares costs equitably and incentivises demand flexibility; and, community access programmes ensuring clean energy reaches every income level. BE Solar urges the Ministry to commit to these mechanisms with defined timelines and measurable targets.

CONCLUSION AND SPECIFIC REQUESTS

BE Solar respectfully submits the following specific requests to the Ministry:

1. That the Ministry commissions and publishes a transparent, disaggregated analysis of the structural drivers of electricity demand decline before finalising any policy.
2. That any proposed LNG investments be subject to a full, publicly available cost-benefit analysis against equivalent capital invested in modern storage, demand management, and renewable alternatives, updated for 2026 economics.
3. That any LNG analysis includes full answers to the siting, safety, and operational questions raised in this submission, including the FSRU question, exclusion zone implications, specialist workforce costs, emergency preparedness requirements, and environmental risk in Bermuda's specific conditions, before any commitment is made.
4. That the NESP commits to tariff reform, community solar access, and distributed energy resource coordination as explicit policy priorities with defined timelines.
5. That the Government opens a formal working group with industry, the Regulatory Authority, and community representatives to design energy access programmes for low and middle income Bermudians, and that BE Solar be considered as a participant in that process.

Thank you for your thoughtful consideration.

Respectfully submitted,

Robbie Godfrey - On behalf of the BE Solar team

Chief Executive Officer

BE Solar Ltd.

ceo@besolar.bm

1.441.279.5907

www.BEsolar.bm