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In a stunning announcement, the St. Kitts Electricity Company Limited (SKELEC), in conjunction with the St. Kitts and Nevis government, has revealed a dramatic increase in electricity bills, sending shockwaves through the island’s economy. Effective November 1st, 2024, the Fuel Variation Charge (FVC), which had been subsidized by the government since June 2022, will be reinstated, leading to a significant rise in utility costs for commercial customers.

SKELEC’s letter to customers confirmed that the ongoing energy challenges and external market conditions have necessitated this adjustment. While the government previously absorbed fuel price fluctuations, the rising costs have made it impossible to continue this support, as stated by General Manager Clement Williams. “We recognize that this adjustment may have financial implications for some commercial customers,” SKELEC’s letter reads, urging businesses to seek advice on managing their energy consumption.

This development follows earlier warnings from former Prime Minister Dr. Hon. Timothy Harris, who, during the People’s Labour Party (PLP) Monthly Press Conference, had predicted a rise in electricity bills after revealing findings from the 2024 IMF country report. Dr. Harris cautioned consumers to “watch your electricity bill” as the Drew Administration’s removal of the fuel subsidy would lead to an inevitable spike in costs.

Harris’s statement has sparked public outrage, as the Drew Administration has remained silent on the issue, leaving citizens in the dark about the full extent of the upcoming changes. Many have questioned the government’s transparency and commitment to the economic well-being of its people, especially in a time when inflation and economic challenges already weigh heavily on households.

The Fuel Subsidy was introduced in June 2022 by the Dr. Hon. Timothy Harris led administration. In a statement issued during a Press Conference in June 2022 then DPM Hon. Eugene Hamilton stated “External factors such as the conflict in Ukraine have driven up the cost of oil, which in turn has caused hardships in countries around the world. St Kitts and Nevis is no exception to the dramatic spike in the price of fuel.”

“The cost of fuel has more than doubled and it has resulted in subsidy being provided by the Government to be able to keep lights in your home,” Deputy Prime Minister and Minister of Public Infrastructure, the Honourable Eugene Hamilton, said at the same press conference.

He explained that for the month of June, the Government spent a total of $9.5 million so that the St. Kitts Electricity Corporation Ltd (SKELEC) could continue to provide electricity to consumers. Without the subsidy, the Deputy Prime Minister estimated that tariff increases would incur, and the cost of electricity bills per household may have jumped by an additional $500 per household.

Now in October 2024, As the nation braces for higher utility costs, this revelation has ignited a debate over government accountability and its handling of public resources. With the impending removal of subsidies and the reinstatement of the FVC, St. Kitts and Nevis faces a financial storm, with consumers demanding clearer communication and relief from the rising cost of living.