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CUC reports growth for 2022

Business 20 Feb, 2023 Follow News

CUC reports growth for 2022

Cayman’s electricity provider has announced growth during 2022. It found that, despite the challenges of 2022, with rising inflationary pressures and fuel costs, the Cayman Islands economy proved to be resilient.

CUC saw a 2% sales growth from new customers, with total customers as at the end of 2022 at 33,119, an increase of 934 or 3% compared to 32,185 customers as at the end of 2021. These new customers, plus developments in the construction sector were the driving factors in their growth. They also saw a 2% increase in the summer peak load.

2022 was a tough year for energy consumers, with rising fuel costs impacting customer bills. CUC’s average price per imperial gallon of fuel for 2022 increased by 61% to $4.67 in comparison to $2.90 in 2021. In July 2022, government initiated the Electricity Assistance Relief Programme to assist residential customers with the impact of high fuel prices through to the end of the year.

In addition, in October 2022, the regulator approved the proposed CUC Fuel Relief Programme applicable to all customers to reduce the financial impact of the fuel cost spike to all customer from 1 October to 31 December, 2022. CUC said this action reinforced its commitment to its sustainability plan.

Electricity, while proving to be increasingly expensive over 2022, was also reliable. During 2022, CUC recorded exceptional reliability performance, they said, their reliability results surpassing that of the 2021 North American Average for electricity service interruption while they continued to maintain a consistent standard in its safety performance overall.

In 2022, two new 13 kilovolt feeders were completed and put into service. These feeders would provide improved reliability for approximately 13,000 residential customers in the Prospect and Newlands areas, they advised. In September 2022, CUC signed an agreement with the technology group Wärtsilä for the supply of two 10 MW energy storage systems. In November 2022, they also signed an agreement with MAN Energy Solutions SE for life-cycle upgrades for five existing engines with a total capacity of 68 MW.

These upgrades would increase the fuel efficiency and extend the useful life of the engines and allow the use of alternate, cleaner fuel sources. These projects all form a part of CUC’s integrated resource plan as CUC seeks to reduce its reliance on fossil fuels and increase renewable energy penetration, they said.

CUC President and CEO Richard Hew said 2022 was a positive year for CUC.

“Significant effort was made by CUC to innovate and progress major projects while continuing to offer operational excellence,” he said. “The Company responded well in the aftermath of Tropical Storm Ian and not many customers were without electricity service for a long period of time.”

Mr Hew said most financial experts were predicting a global recession in 2023 and that meant that the Cayman Islands could likely see some slowing in the economy.

“CUC will remain vigilant and focussed on being an efficient operation while providing an excellent service to its customers,” he stated.

Net earnings for the year ended 31 December, 2022 were $33.2 million, a $2.9 million increase from net earnings of $30.3 million for the year ended December 31, 2021, due primarily to higher operating income and slightly lower finance charges.

After the adjustment for dividends on CUC preference shares, earnings on Class A Ordinary Shares for 2022 were $32.2 million, or $0.86 per Class A Ordinary Share, as compared to $29.3 million, or $0.79 per Class A Ordinary Share, for 2021.

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