Fuel Clause Adjustment

The Fuel Clause Adjustment (FCA) was originally established in 1965 for commercial and industrial customers and extended to include all customers in 1974. The FCA is approved by the Commission as a mechanism for the Barbados Light & Power (BLPC) to recover the cost of fuel used in the production of electricity. The cost of fuel purchased is recovered and applied equally to all customer groups through the FCA charge. Changes in the FCA are influenced mainly by movements in the purchase price of fuel.

 The FCA is calculated monthly as the sum of the previous month’s cost of energy purchased and cost of fuel consumed, plus any cumulative over and under recovery divided by the kWh sales of the previous month. The cost of energy purchased includes energy purchased from renewable energy resources.

The Fair Trading Commission is responsible for setting and monitoring the rates Light & Power charges customers. This includes checking the calculation of the fuel clause adjustment. The fuel clause adjustment for each month is published in the daily newspapers early in the month.