1. Executive Summary

Barbados Light & Power Company (BL&P) is facing a critical juncture in its efforts to support Barbados' ambitious renewable energy transition. The company's urgent need for increased battery energy storage systems (BESS) is driven by the rapid growth of distributed photovoltaic (DPV) systems, which are nearing the current grid's capacity. BL&P's attempt to proactively address this challenge with a request for 90 megawatts (MW) of BESS capacity was largely unmet by the Fair Trading Commission (FTC), which approved only 15 MW. This regulatory decision has raised concerns about the potential for stalled renewable energy connections and the overall pace of Barbados' clean energy goals. This report delves into the multifaceted aspects of this situation, examining the underlying reasons for the increased demand for battery storage, the potential benefits it offers to the power grid, the existing infrastructure and past initiatives, the crucial role of regulatory approvals, the associated challenges and controversies, and ultimately, a timeline of key events shaping this unfolding story.

2. Introduction: Barbados' Energy Transition and the Need for Grid Stability

Barbados has established a bold vision for its energy future, aiming to achieve 100% renewable energy by the year 2030.1 This ambitious target is rooted in a strong commitment to energy independence and the creation of a climate-resilient nation.3 The Barbados National Energy Policy (BNEP) 2019-2030 serves as the guiding framework for this transformative goal, outlining the strategic pathways to a completely renewable energy-based economy.4 While the 2030 deadline presents a significant undertaking, there is an acknowledgment that achieving it fully might encounter challenges, with some officials suggesting a potential slight delay.10 Nevertheless, the overarching dedication to transitioning away from fossil fuels remains a central tenet of the nation's policy.10

A key driver in Barbados' renewable energy progress has been the substantial adoption of solar energy across various sectors. By August 2024, distributed photovoltaic (DPV) systems connected to the Barbados Light and Power Company's grid were approaching a total capacity of 100 MW.9 This widespread embrace of solar technology, while a positive step towards the 2030 goal, has concurrently brought to the forefront challenges related to the grid's capacity to absorb and manage this influx of variable energy.9 The very success of DPV integration has highlighted the immediate necessity for robust grid stabilization measures, emphasizing that the deployment of renewable energy generation must be coupled with adequate infrastructure to ensure the system's reliability and efficiency.14

For Barbados to fully realize its renewable energy aspirations, maintaining a stable and reliable electricity supply is paramount.16 The inherent intermittency of renewable sources like solar and wind necessitates the implementation of effective solutions to guarantee a consistent power flow.9 Battery energy storage systems (BESS) are recognized as a critical component in addressing the temporal mismatch between renewable energy generation and consumer demand.9 Furthermore, the modernization of the power grid and the seamless integration of energy storage are essential prerequisites for accommodating a greater share of renewable energy sources in the overall energy mix.9 Therefore, grid stability is not merely a technical consideration; it forms the bedrock upon which Barbados' renewable energy targets and the dependable provision of electricity to its population and economy are built.16

3. The Urgent Need for Enhanced Battery Storage at Barbados Light & Power

Barbados Light & Power Company's technical assessments have revealed that the currently approved 15 MW of battery energy storage systems (BESS) possesses the capability to maintain grid stability only up to a maximum of 99.9 MW of total installed distributed photovoltaic (DPV) systems.12 As of August 1, 2024, the cumulative capacity of DPV systems connected to the grid was nearing this threshold, reaching almost 100 MW.12 This near-capacity situation has a direct and immediate consequence: no additional renewable energy customers can be connected to the grid until further BESS capacity is brought online.12 This bottleneck in grid connectivity poses a significant impediment to the continued expansion of renewable energy generation within Barbados, potentially affecting homeowners and businesses eager to adopt cleaner energy solutions.14

In an effort to proactively address this looming constraint, BL&P submitted an application to the Fair Trading Commission (FTC) in October of the previous year (2023), seeking approval for 90 MW of BESS capacity as an integral part of its Clean Energy Transition Plan (CETP).1 However, the FTC's response to this substantial request was to approve only 15 MW of BESS capacity.1 This decision, granting merely one-sixth of the requested amount, suggests a notable divergence in perspective between BL&P and the regulatory body regarding the scale and urgency of the required battery storage infrastructure.1 Understanding the FTC's rationale behind this limited approval is crucial to comprehending the current situation and the path forward for Barbados' energy transition.

The significant disparity between BL&P's identified need for 90 MW of BESS and the FTC's approval of only 15 MW has understandably generated concerns within the power company about its capacity to facilitate Barbados' growing renewable energy demands.12 Industry stakeholders have also voiced apprehension, with warnings that renewable energy projects valued at hundreds of millions of dollars are now facing uncertainty due to this impasse on battery storage deployment.15 It is reported that approximately 32 MW worth of renewable energy projects have already been constructed and financed but are currently unable to connect to the grid due to the lack of sufficient battery storage capacity.15 This situation underscores that the FTC's decision has repercussions extending beyond BL&P, potentially impacting the broader renewable energy sector in Barbados by creating a bottleneck that could deter further investment and decelerate the nation's progress towards its clean energy objectives.14

4. Anticipated Benefits of Increased Battery Storage for Barbados' Power Grid

The deployment of increased battery energy storage systems (BESS) on Barbados' power grid is expected to yield several critical benefits, particularly in supporting the integration of renewable energy sources. One of the primary advantages is the significant improvement in grid reliability and stability.19 BESS can provide essential reactive power compensation and precise voltage regulation, which are increasingly important as the grid incorporates more variable renewable energy generation.19 This capability contributes directly to maintaining a consistent and stable electricity supply for all consumers, mitigating fluctuations and ensuring the overall health of the power system.

Furthermore, enhanced battery storage capacity is anticipated to lead to a notable reduction in power outages and an overall increase in the grid's resilience.29 BESS can act as a readily available source of backup power during periods of peak demand or in the event of unexpected disruptions.29 This is particularly crucial for an island nation like Barbados, which is susceptible to extreme weather events. A more resilient energy system, bolstered by adequate battery storage, can better withstand such disruptions, ensuring greater energy security and minimizing the impact of natural disasters on the continuity of the power supply.9

A key challenge in maximizing the use of renewable energy is its inherent variability. Battery storage provides a vital solution by enabling better management of these fluctuations.9 During periods when renewable energy generation exceeds demand, such as when solar production peaks during the day, the excess energy can be stored in batteries.9 This stored energy can then be efficiently dispatched back to the grid during times of low renewable output or when electricity demand is high.9 This effective management of renewable energy intermittency not only optimizes the utilization of clean energy resources but also reduces the reliance on traditional fossil fuel-based generators, leading to a more sustainable and efficient power grid.9

Beyond the immediate benefits to grid stability and reliability, increased battery storage also holds the potential for long-term cost savings.2 By reducing the dependence on imported fossil fuels, which are subject to price volatility, Barbados can achieve greater cost stability in its energy sector.2 Furthermore, the efficient storage and dispatch of renewable energy can minimize the necessity for curtailment, ensuring that the generated clean energy is fully utilized. While the initial investment in BESS represents a significant capital outlay, the anticipated long-term operational savings derived from reduced fuel consumption and optimized renewable energy use could ultimately make it a financially prudent investment for Barbados.3

5. Existing Battery Storage Infrastructure and Prior Initiatives

As of August 2023, the installed battery storage capacity connected to Barbados' electricity grid was quite limited, amounting to only 5 MW.1 This entire capacity is owned and operated by the utility, Barbados Light & Power Company, and is located at their Trents, St. Lucy facility.2 While this represents an initial step towards incorporating energy storage, it falls significantly short of the projected needs for grid stabilization and the integration of further renewable energy generation, especially when compared to BL&P's request for 90 MW.1 However, the regulatory landscape has seen some movement, with the Fair Trading Commission (FTC) having approved an additional 15 MW of BESS capacity through the Clean Energy Transition Rider (CETR).1 This approval marks a positive, albeit partial, step forward in augmenting the island's energy storage capabilities.

Barbados Light & Power Company's Clean Energy Bridge (CEB) project, which commenced around 2020, provides an example of an earlier initiative that included battery storage. Located at the Trents, St. Lucy site, the CEB project incorporated a 5 MW battery storage system alongside a 10 MW solar photovoltaic plant and a 33 MW medium-speed diesel generation plant.2 The primary objective of the CEB project was to serve as a transitional solution, bridging the gap between the decommissioning of older, less efficient fossil fuel generation units and the development of a larger renewable energy infrastructure.2 The inclusion of battery storage within the CEB framework, even at this initial scale, demonstrates BL&P's early recognition of the crucial role that energy storage would play in facilitating the integration of renewable energy sources into the grid.2

Recognizing the growing importance of energy storage, the Government of Barbados also took a proactive step in the preceding year (2023) by directing BL&P to initiate a 50 MW energy storage pilot program.1 To support this pilot, the government established an energy storage pilot tariff framework, setting a rate of BBD$0.270/kWh for 4-hour battery systems ranging in size from 1 MW to 10 MW.1 This governmental initiative signals a broader strategy to explore and encourage the deployment of energy storage solutions beyond BL&P's direct investment plans, potentially fostering the participation of independent power producers (IPPs) in this critical area.1

6. Regulatory Landscape: The Role of the Fair Trading Commission (FTC)

The Fair Trading Commission (FTC) holds a central position in the regulatory framework governing the energy sector in Barbados, acting as the primary authority overseeing electricity utilities and ensuring fair practices.1 A key aspect of its mandate involves the approval of cost recovery applications submitted by utilities like Barbados Light & Power Company (BL&P), allowing them to recoup investments made in infrastructure and operations through customer tariffs.1 In exercising its regulatory responsibilities, the FTC is required to conduct public consultations before making significant decisions concerning utility regulation, ensuring transparency and allowing for stakeholder input.24 Consequently, the FTC's decisions on BL&P's proposals for battery energy storage systems (BESS) are of paramount importance in shaping the trajectory of Barbados' energy transition.23

The Fair Trading Commission's decision in May 2024 regarding BL&P's application for 90 MW of BESS capacity marked a significant point in this regulatory process. The FTC granted approval for only 15 MW of the requested capacity and did not approve the deployment of synchronous condensers, another key component of BL&P's proposal for grid stabilization.1 However, the FTC did approve the recovery of costs associated with the 15 MW of BESS through the Clean Energy Transition Rider (CETR), a mechanism designed to facilitate the financing of clean energy initiatives.1 This selective approval by the FTC suggests a measured approach, indicating potential concerns regarding the financial implications and perhaps the technical justifications presented by BL&P for the larger scale of battery storage deployment.1

In its rationale for the partial approval, the FTC specifically noted that BL&P had not provided sufficient comparative analysis with alternative investment options, with the exception of pumped hydro energy storage (PHES).1 Furthermore, the FTC's own financial assessments estimated a lower capital expenditure for the proposed BESS project compared to BL&P's projections.1 Consequently, the regulatory body directed BL&P to conduct a more comprehensive cost-benefit analysis for the remaining proposed BESS capacity, explicitly requesting the inclusion of costs related to the potential deferral of transmission and distribution infrastructure upgrades.1 These stipulations from the FTC underscore its role in ensuring that substantial investments in the energy sector are economically sound and that all viable alternatives are thoroughly evaluated before regulatory approval is granted, acting as a safeguard for consumer interests.1

In response to the FTC's decision, BL&P has formally requested a reconsideration of the approved BESS capacity.12 Alongside this appeal, the power company has reiterated the critical need for synchronous condensers to further enhance grid stability as the penetration of solar photovoltaic systems continues to increase.12 BL&P also communicated that updated pricing proposals from suppliers indicated a higher average cost for the approved 15 MW of battery storage compared to the cost of the initially requested 90 MW, attributing this increase to the loss of economies of scale.12 This ongoing engagement between BL&P and the FTC highlights the dynamic nature of the regulatory process and the utility's continued efforts to secure the necessary infrastructure for supporting Barbados' renewable energy transition.12

7. Funding Sources and Strategic Partnerships

The Government of Barbados' unwavering commitment to achieving 100% renewable energy by 2030 serves as a fundamental policy driver for investments in grid stabilization technologies like battery energy storage systems (BESS).4 To further incentivize this transition, the government has implemented various fiscal measures aimed at promoting the adoption of renewable energy and energy efficiency across the island.4 These policies create a supportive environment that encourages investment in clean energy infrastructure.5

A crucial financial mechanism for Barbados Light & Power Company (BL&P) in funding its clean energy initiatives is the Clean Energy Transition Rider (CETR).1 This regulatory tool allows BL&P to recover the upfront costs associated with its investments in clean energy projects, including battery storage, through adjustments to customer tariffs.1 The Fair Trading Commission (FTC) approved the use of the CETR for the 15 MW of BESS capacity that was part of its partial approval of BL&P's larger request.1 The CETR represents a vital pathway for BL&P to finance its contributions to the national renewable energy goals, although the extent of its application remains subject to the scrutiny and approval of the regulatory body.22

In a significant move to augment the island's battery storage capacity, the Ministry of Energy and Business launched a request for information (RFI) in November 2024, seeking proposals for the implementation of 60 MW of BESS.40 This initiative is distinct from BL&P's direct application and is designed to encourage the participation of independent power producers (IPPs) in deploying energy storage solutions.40 The competitive procurement process following this RFI is anticipated to commence in early 2025.40 This government-led tender indicates a strategic approach to diversifying the ownership and accelerating the deployment of battery storage, with a stated goal of achieving a total of 150 MW of storage capacity by 2026 through a combination of utility-led and independent projects.40

The Renewstable Barbados project exemplifies a large-scale initiative leveraging international partnerships and funding to advance renewable energy and storage in Barbados.8 This project involves the development of a 50 MWp solar photovoltaic plant integrated with 15 MW (30 MWh) of battery energy storage and a substantial 90 MWh of green hydrogen storage.8 It is a collaborative effort involving the European Union (EU), the Government of Barbados, and the French company HDF Energy.36 The Renewstable Barbados project has secured significant financial backing and support from organizations such as the Green Climate Fund (GCF) and the European Investment Bank (EIB).8 The integration of hydrogen storage in this project is particularly noteworthy as it offers a solution for longer-duration energy storage, which is crucial for ensuring a consistent and reliable supply of renewable energy. Such large-scale, internationally supported projects highlight the potential for substantial advancements in Barbados' energy infrastructure.

The Energy Smart Fund, a financing facility capitalized through a loan from the Inter-American Development Bank (IDB) and grant resources from the European Union (EU), provides another important avenue for funding renewable energy and energy efficiency projects in Barbados.32 The fund offers technical assistance grants and concessionary loans to businesses seeking to implement clean energy solutions.59 This initiative plays a vital role in democratizing access to renewable energy by providing crucial financial support for smaller-scale projects undertaken by businesses and individuals, thereby contributing to the overall progress towards Barbados' energy transition goals.32

8. Challenges, Controversies, and Alternative Solutions

The pursuit of increased battery energy storage in Barbados is not without its challenges and potential controversies. A significant hurdle is the cost implications associated with deploying BESS on a large scale. Barbados Light & Power Company (BL&P) reported that the average cost for 15 MW of battery storage was approximately 30 percent higher than the projected cost for 90 MW, primarily due to the loss of economies of scale.12 The Fair Trading Commission (FTC) also acknowledged the substantial capital expenditure required for BESS projects.1 These high upfront costs necessitate careful economic evaluation and the exploration of innovative financing models to ensure that the deployment of battery storage remains economically viable for both the utility and the consumers.1

Regulatory processes can also present challenges and lead to delays in the implementation of crucial energy infrastructure projects. The FTC's decision to approve only a fraction of BL&P's requested BESS capacity and its demand for further detailed analysis have already introduced delays in the utility's expansion plans.1 More broadly, complex and protracted bureaucratic procedures within the regulatory environment can sometimes impede the swift adoption of new energy technologies that are essential for achieving national energy goals.18 The interaction between BL&P and the FTC underscores the inherent complexities in navigating the regulatory landscape within the energy sector.18

While the overarching goal of increasing renewable energy and battery storage is environmentally positive, large-scale energy projects can still have localized environmental impacts. For instance, the development of solar farms and battery storage facilities can involve land use changes.61 It is therefore imperative that thorough environmental impact assessments are conducted and that appropriate measures are implemented to prevent and mitigate any potential negative consequences during both the construction and operational phases of these projects.61 Integrating sustainable practices into the development and operation of renewable energy infrastructure is crucial to ensuring that the pursuit of cleaner energy does not inadvertently create other environmental concerns.3

In addition to battery storage, BL&P has highlighted the critical role of synchronous condensers (SCOs) in enhancing grid stability, particularly with the increasing integration of solar photovoltaic systems.12 SCOs are essential for adjusting voltage on the electricity grid and providing fault current, which inverter-based solar systems do not inherently offer to the same extent as traditional fossil fuel generators.12 These rotating machines can mimic the behavior of large power plants by providing spinning inertia and reactive power, thereby strengthening the grid.20 The combination of SCOs and BESS can offer significant advantages for grid support, including increased short-circuit current capacity, improved frequency support, and enhanced reactive power control.20 The fact that the FTC did not approve BL&P's request for synchronous condensers in its initial decision is a notable point, suggesting that a comprehensive strategy for grid stabilization may require the deployment of both battery storage and synchronous condenser technologies.19 BL&P's emphasis on the necessity of SCOs indicates an understanding that a multi-faceted approach, utilizing various grid stabilization technologies, may be the most effective pathway to a reliable and renewable energy future for Barbados.

9. Timeline of Key Events in Barbados Light & Power's Battery Storage Initiatives

• 2019: The Government of Barbados approves the Barbados National Energy Policy 2019-2030 (BNEP), setting a target of 100% renewable energy by 2030.4
• September 2020: BL&P reports progress on its Clean Energy Bridge (CEB) project, which includes 5 MW of battery storage at Trents, St. Lucy. BL&P also notes that customer-owned solar generation connected to the grid exceeds 35 MW, in addition to the company's 10 MW solar facility.2
• 2021: Government modeling indicates a need for 204 MW of energy storage by 2030, with an interim target of 144 MW by 2025, to effectively support the nation's renewable energy objectives.1
• November 2022: BLPC issues a warning about increasing grid instabilities and informs renewable energy project developers that new projects exceeding 100 MW capacity will only be connected if they incorporate energy storage solutions or agree to periodic curtailment of their output.14
• August 2023: The total installed renewable energy generation capacity on the island reaches 87 MW, while the connected battery storage capacity remains at a modest 5 MW.1
• October 2023: BL&P submits an application to the Fair Trading Commission (FTC) seeking approval for 90 MW of battery energy storage systems (BESS) as part of its comprehensive Clean Energy Transition Plan (CETP). The FTC announces a postponement of its decision regarding Feed-in-Tariffs for renewable energy projects above 1 MW, citing concerns about the current inadequacy of energy storage on the grid.47
• May 6, 2024: The FTC issues its decision on BL&P's application for 90 MW of BESS, approving only 15 MW and declining to approve the requested synchronous condensers.1
• August 1, 2024: The total capacity of distributed photovoltaic (DPV) systems connected to the grid approaches 100 MW, leading BL&P to issue a public statement indicating that no further renewable energy customers can be connected until additional battery storage capacity is installed.12
• August 17, 2024: Barbados Today publishes an article titled "Light & Power seeks more battery storage to stabilise grid," highlighting the disparity between BL&P's request and the FTC's approval, as well as the identified need for synchronous condensers to enhance grid stability.12
• November 8, 2024: The Ministry of Energy and Business in Barbados initiates a request for information (RFI) for 60 MW of battery energy storage systems, marking the initial phase of a competitive procurement process anticipated to commence in early 2025.40
• November 12, 2024: BNamericas reports on Barbados' launch of a call for proposals for 60 MW of battery energy storage capacity.51
• December 2024: SINOSOAR secures a contract for a 4.6 MWh Hybrid BESS Project in Barbados, commissioned by the Barbados National Petroleum Corporation (NPC).60
• February 19, 2025: The Renewstable Barbados project, featuring a 50 MWp solar plant with integrated battery and green hydrogen storage, is officially launched as a collaborative effort between the EU, Barbados, and HDF Energy.36
• February 2025: The Government of Barbados intensifies its efforts to address the challenges related to grid storage, which are deemed crucial for achieving the nation's renewable energy targets by 2030. The Minister of Energy outlines a comprehensive strategy focused on expanding battery storage capacity and enhancing grid resilience.43
• March 2025: Barbados hosts the Sustainable Energy for All Global Forum, underscoring the country's strong commitment to the transition towards renewable energy sources.11 Prime Minister Mia Amor Mottley addresses the launch of the Barbados Energy Transition and Investment Plan (ETIP), reaffirming the national goal of reaching net-zero emissions by 2035 and highlighting ongoing efforts to streamline regulatory processes that have previously caused delays in project implementation.68

10. Conclusion and Future Outlook

The situation in Barbados highlights the intricate relationship between ambitious renewable energy goals and the necessary grid infrastructure to support them. Barbados Light & Power's proactive identification of the need for increased battery storage underscores a forward-thinking approach to maintaining grid stability amidst a rapid expansion of distributed solar generation. However, the significant gap between BL&P's request for 90 MW of BESS and the FTC's approval of only 15 MW signifies a critical regulatory hurdle that could potentially impede the pace of renewable energy adoption on the island and affect the reliability of the power grid as more intermittent sources come online.

The FTC's cautious approach, emphasizing the need for comprehensive cost-benefit analyses and the consideration of alternative technologies, reflects its mandate to protect consumer interests and ensure prudent investment in the energy sector. BL&P's subsequent request for reconsideration and its highlighting of the importance of synchronous condensers indicate an ongoing dialogue and a commitment to finding a solution that addresses both the immediate grid stability needs and the long-term renewable energy targets of Barbados.

The government's parallel initiative to procure 60 MW of battery storage through an independent tender demonstrates a multi-faceted strategy to overcome the current bottleneck. This approach, involving both the utility and independent power producers, suggests a recognition of the urgency in augmenting the island's energy storage capacity. Furthermore, large-scale projects like Renewstable Barbados, with their innovative integration of solar, battery, and hydrogen storage, showcase the potential for transformative advancements in the nation's energy infrastructure, particularly through international collaboration and financial support.

Looking ahead, the future of grid stability in Barbados will likely depend on the continued engagement and collaboration among all stakeholders. This includes the government, Barbados Light & Power, the Fair Trading Commission, independent power producers, and international partners. Successfully navigating the regulatory landscape, securing adequate funding, and deploying the appropriate mix of technologies, including battery storage and potentially synchronous condensers, will be crucial for Barbados to achieve its vision of a sustainable and resilient energy future. The ongoing developments, including the government's 60 MW tender and BL&P's pursuit of its BESS expansion plans, suggest a dynamic environment with a clear commitment to overcoming the current challenges and realizing Barbados' ambitious renewable energy goals.