Following a dramatic increase in the cost of electricity since the start of the war in Ukraine, the Virgin Islands government will subsidise residential power bills through the end of the year, Deputy Premier Kye Rymer announced Monday.

For the months of October and November, government will subsidise 50 percent of the fuel oil surcharge of each bill, and the percentage will increase to 100 percent for December, according to Mr. Rymer, who is the minister of communications and works.

“We are all aware that since the Russia-Ukraine war escalated in February 2022, electricity bills began to increase dramatically,” he added. “This has been no fault of the BVI Electricity Corporation. It has been the result of the high cost of fossil fuels on the international market.”

Three-part bills

Under local legislation, Mr. Rymer explained, the fuel surcharge is one of three major parts of residents’ electricity bills.

“First, there is a flat $2.50 per month for the service,” he said. “Second, there are standard charges based on the quantity of energy consumed. The third component is the fuel oil surcharge, which is tied to the price of fuel — and oil prices have risen to record high levels since the escalation of the Russia-Ukraine conflict.”

The minister did not disclose the initiative’s expected cost to the government, but he said it will be funded through a Schedule of Additional Provisions recently approved by the Cabinet and the House of Assembly,

“The SAP was approved by Cabinet about three weeks ago, and it was passed by the HOA about two weeks ago,” he said Monday. “Certain measures needed to be put in place for implementation, which has since been completed, so that the subsidy can be put into effect as being announced today.”


Mr. Rymer acknowledged that many residents have been struggling financially since the beginning of the Covid-19 pandemic in March 2020.

“The pockets of the people worldwide have been hit by the rise in the cost of goods and services,” he added. “The situation became even worse with the escalation of the Russia-Ukraine conflict in February 2022. These events have caused significant disruptions in the supply of food, raw materials for industry, and the availability and price of fuel on the international market.”

He added that such issues are not limited to the Virgin Islands, but have also afflicted most other countries as well. Jurisdictions that rely heavily on imports, he noted, have been particularly hard hit by the rising prices.

“Some of you would have seen the news in the United States and the United Kingdom, for example, where people have been struggling and cannot pay high fuel prices for their vehicles and electrical bills,” he said. “Practically no one has been spared.”

Other measures

Mr. Rymer also touted other recent measures he said were designed to ease the financial burden of rising prices.

One initiative — which reduced customs duties above five percent to five percent — was imposed on April 15 for a period of three months, and later extended three more months through Oct. 15.

Effective during the same period are reductions of import duty from 22 cents to 11 cents on diesel and from 32 cents to 16 cents on gasoline, and reductions from 18 cents to 9 cents per 100 pounds of cement and $1.20 to 60 cents for 100 pounds of propane.

“While no one can control the international cost of fuel — which is the price at which the fuel companies purchase petrol and diesel from international suppliers to ship to the Virgin Islands — what we were able to do was to reduce the import duty on the fuel effectively by 50 percent, so that local consumers were spared the full brunt of the rising prices,” Mr. Rymer said Monday.

Despite the duty cuts, however, many residents have continued to complain about high prices and to question whether businesses are passing on any savings to consumers.