St. Vincent targets electricity costs as government unveils cost-of-living measures

Prime Minister Dr. Godwin Friday has outlined a series of measures aimed at easing the burden of rising living costs in St. Vincent and the Grenadines, with the government placing immediate focus on reducing the impact of high electricity bills on households and businesses.

Speaking on state-owned NBC Radio on Tuesday, Friday said his eight-month-old New Democratic Party (NDP) administration is reviewing additional ways to cushion residents from rising energy costs linked to the war in the Middle East and its impact on global oil markets.

“The surcharge is too high, but it’s still lower than it could have been because of the measures that we have instituted,” Friday said, adding that both the government and state-owned St. Vincent Electricity Services Limited (VINLEC) must share some of the burden rather than passing the full cost on to consumers.

The prime minister said electricity costs represent one of the most immediate pressures facing families and businesses, noting that increases in VINLEC’s operating costs are directly reflected in consumer bills.

“It affects everybody. I have total sympathy with the families who are struggling to make ends meet because of increasing energy prices,” he said.

Friday said the government introduced measures in May to reduce the impact of rising diesel prices, including removing the fuel surcharge at the port on diesel imported by VINLEC, reducing or eliminating excise taxes on the fuel and encouraging VINLEC to absorb part of the increased costs instead of passing them entirely to customers.

He said VINLEC absorbed more than EC$730,000 in July that would otherwise have been added to consumers’ electricity bills.

Without those interventions, Friday said, the fuel surcharge could have exceeded 90 cents per kilowatt-hour, creating significant pressure on households, businesses and the wider economy.

The prime minister also urged VINLEC to reconsider its approach to disconnecting customers during the current economic challenges.

“VINLEC also has to understand that they can’t rush and cut off people in the same time frames that they used to,” he said. “We have to all have some more grace and simply say we are trying to work our way through this crisis.”

While acknowledging that subsidies and tax reductions are short-term solutions, Friday said the country must pursue longer-term reforms to reduce its vulnerability to global oil price fluctuations.

He said the government’s strategy includes investing in renewable energy and creating a more sustainable energy system, with VINLEC taking a leading role in the transition.

“VINLEC has to lead the way… so that we become more sustainable in our energy supply,” Friday said.

Beyond electricity costs, the prime minister announced additional measures aimed at helping families manage everyday expenses, including targeted support for low-income households and families preparing for the new school year.

Friday said the government’s next VAT-free shopping day will take place on Aug. 28 and will focus specifically on back-to-school purchases. He said the initiative follows a successful VAT-free day in December 2025 that generated a strong response from shoppers in Kingstown.

He encouraged retailers to support the initiative by offering additional discounts and said businesses had received earlier notice this time to better prepare for increased demand.

The prime minister also highlighted the government’s increase in public assistance payments to EC$500 per month for vulnerable residents, as well as the removal of registration fees for secondary schools and the Community College.

The government will also cover examination fees for students completing secondary school, Friday said, arguing that access to education should not be limited by financial barriers.

“You shouldn’t get to Form 5 and then you’re basically out there with a sponsor sheet to write eight or 10 subjects,” he said. “That’s part of your education. The state will take care of that responsibility.”