ACP-SXM wants answers from SOL on GEBE fuel costs, pricing structure and impact on consumers

GREAT BAY--The Association for Consumer Protection St. Maarten, ACP-SXM, has formally written to SOL Antilles NV seeking clarification on fuel supply negotiations with NV GEBE, the transparency of pass-through costs and the impact of SOL’s pricing structure on consumers in St. Maarten.

The letter, dated June 18, 2026, was addressed to Mr. Robert James, Managing Director and Regional Manager Eastern Caribbean of SOL Antilles NV. ACP-SXM said it is acting on behalf of consumers who are directly and materially affected by the structure of fuel supply costs passed through to electricity tariffs charged by NV GEBE.

ACP-SXM stated that, as a registered non-profit organization established to protect consumer rights in St. Maarten’s utility and service sectors, it has an obligation to seek clarification on matters that directly influence the cost of electricity to households and businesses.

The association said its letter follows statements made by Prime Minister Dr. Luc Mercelina during a public Parliamentary session on June 12, 2026, concerning the breakdown of contract negotiations between NV GEBE and SOL Antilles NV. According to ACP-SXM, those statements were subsequently reported in The People’s Tribune SXM under the headline “GEBE-SOL fuel talks failed over lack of transparency in pass-through costs.”

ACP-SXM said it reviewed both the Parliamentary record and the published reporting before writing directly to SOL Antilles NV. The organization stressed that it does not assume that the public statements represent a complete or fully accurate account of SOL’s position, which is why it is seeking written clarification directly from the company.

According to ACP-SXM, Prime Minister Mercelina stated publicly that SOL identified premiums, freight, insurance, procurement, losses and related charges as direct pass-through costs, and that NV GEBE requested substantiating documentation for those costs. ACP-SXM also noted the Prime Minister’s statement that SOL indicated no further information beyond what had already been provided would be forthcoming.

The association further cited the reported position that SOL’s margin is covered solely by the marketing differential, while pass-through costs have increased substantially over the years. ACP-SXM said COVID-19 and the Russia-Ukraine war were cited as contributing factors, but that the explanations were not substantiated in a transparent manner.

ACP-SXM also noted public statements that SOL’s ownership of fuel storage facilities and established delivery routes create significant barriers to entry for competing suppliers, contributing to SOL’s market position and reducing flexibility in St. Maarten’s fuel supply chain.

In its letter, ACP-SXM said it undertook a detailed review of the RAC/BTP tariff evaluation report covering the period March 2022 through December 2024, as well as NV GEBE’s fuel clause methodology and tariff structure. The organization said the findings directly implicate the SOL pricing structure as a contributing factor to consumer harm.

ACP-SXM said SOL’s fuel price to GEBE is composed of eleven components: the Caribbean Posted Price, CPP, plus premiums, insurance, freight, procurement, inspection, loss allowance, CIF, remittance tax, port throughput fee and marketing differential.

The association acknowledged that small-island fuel supply involves logistical costs and that the existence of these components is not inherently unreasonable. However, ACP-SXM said the concern is that components two through eleven, which represent non-commodity surcharges, have been increasing year after year, even as the base CPP tracked international Platts benchmarks.

According to ACP-SXM’s summary of the RAC/BTP analysis, the average annual premium over Platts for Light Fuel Oil, LFO, rose from USD 0.23 per litre in 2022 to USD 0.26 per litre in both 2023 and 2024. The average annual premium for Heavy Fuel Oil, HFO, rose from USD 0.19 per litre to USD 0.24 per litre over the same period.

ACP-SXM said none of these non-commodity surcharges are regulated or independently verified by any government body. The association said consumers bear the full inflation in these components through GEBE’s fuel clause without any mechanism to challenge or verify them.

The organization said this concern aligns with the issue raised by Prime Minister Mercelina, namely that cost increases attributed to COVID-19 and the Russia-Ukraine conflict were claimed but not substantiated in a transparent manner. ACP-SXM said unsubstantiated year-on-year increases in unregulated surcharges, which flow directly into consumer electricity bills through GEBE’s fuel clause, represent a structural consumer protection failure.

ACP-SXM also raised concern about a shift in GEBE’s fuel procurement mix. According to the RAC/BTP report cited by the association, GEBE moved from approximately 95% HFO and 5% LFO in 2022 to 62% HFO and 38% LFO in 2024. ACP-SXM noted that LFO is structurally more expensive than HFO, although the average price gap narrowed from approximately USD 0.35 per litre in 2022 to approximately USD 0.17 per litre in 2024 as LFO’s share grew.

The organization acknowledged that LFO may have operational advantages, including cleaner combustion and reduced maintenance requirements. However, ACP-SXM said the shift significantly increased GEBE’s total fuel procurement costs and, by extension, inflated the fuel clause paid by consumers.

ACP-SXM said no independent body has evaluated whether the transition was economically justified from a consumer perspective, and no cost-benefit analysis has been made publicly available. The association stressed that the fuel mix shift occurred entirely within the bilateral commercial relationship between GEBE and SOL, without regulatory oversight, competitive procurement or consumer consultation.

The association also pointed to what it described as a regulatory gap in St. Maarten’s fuel supply system. It said gasoline, transport diesel and LPG are regulated under St. Maarten’s Prijzenverordening by the Ministry of TEATT, while fuels used for electricity generation are explicitly excluded. As a result, ACP-SXM said SOL and GEBE negotiate fuel prices bilaterally, without independent verification of any price component, including the Platts benchmark itself, which ACP-SXM said is not publicly accessible.

ACP-SXM said this creates a market structure in which a single unregulated fuel supplier, unaudited pricing components and no competitive procurement undermine consumers’ ability to trust that the fuel costs embedded in their electricity bills are fair and market-competitive.

The association also referenced what it described as a consumer overcharge documented in the RAC/BTP report. ACP-SXM said that over a 34-month period from March 2022 through December 2024, consumers paid approximately USD 6.9 million, roughly XCG 12.6 million, more in fuel clause charges than GEBE actually spent on fuel. According to ACP-SXM, the report described this as an accounting ambiguity, but confirmed overcharge.

ACP-SXM said 2024 is of particular concern because the fuel clause reached its highest average ever at NAf 0.408 per kWh, up from NAf 0.325 in 2023, while simultaneously generating the largest surplus on record. The organization said consumers were charged the most precisely when they were most financially exposed.

The association said that by 2024, the fuel clause consistently exceeded 60% of the total electricity price per kWh, meaning the majority of what consumers paid for electricity became the least-regulated and least-transparent component of the tariff.

ACP-SXM clarified that the USD 6.9 million overcharge is primarily attributable to structural defects in GEBE’s fuel clause formula and not solely to SOL’s pricing. However, the organization said those formula defects are compounded by the fact that the fuel cost inputs from SOL, which form the numerator of the fuel clause, are themselves unverified, unregulated and non-transparent.

The association said a formula that cannot be validated, applied to cost inputs that cannot be independently verified, produces utility bills that consumers have no basis to trust.

In its letter, ACP-SXM requested that SOL Antilles NV provide written responses to six specific areas of concern.

First, ACP-SXM asked SOL whether the statements made in Parliament on June 12, 2026, as reported in the media, accurately and fairly characterize SOL’s position during contract negotiations with NV GEBE. If not, ACP-SXM asked SOL to identify which aspects it considers inaccurate or incomplete.

Second, the organization asked whether SOL acknowledges that fuel supplied to GEBE for electricity generation is not currently regulated under the Prijzenverordening or any equivalent framework. ACP-SXM also asked whether SOL considers the current unregulated bilateral arrangement equitable, given its direct impact on consumer electricity tariffs.

Third, ACP-SXM asked SOL to state the legal or contractual basis on which it declined to provide substantiating documentation for pass-through cost components to GEBE. The association also asked whether SOL considers transparency regarding non-commodity surcharges to be a reasonable expectation, given that those costs are ultimately borne by consumers.

Fourth, ACP-SXM requested a breakdown of the factors driving the year-on-year increases in non-commodity surcharges between 2022 and 2024, specifically those attributed to COVID-19 and the Russia-Ukraine conflict. ACP-SXM asked what evidence substantiates those attributions.

Fifth, ACP-SXM asked whether the shift in GEBE’s fuel mix from 95% HFO and 5% LFO in 2022 to 62% HFO and 38% LFO in 2024 was initiated or recommended by SOL. The association also asked whether any independent cost-benefit analysis was conducted to assess the consumer cost implications of that transition.

Sixth, ACP-SXM asked SOL to outline its current position regarding a future fuel supply arrangement with NV GEBE, including what conditions, if any, SOL would require in order to resume or conclude negotiations on terms that include transparency in cost substantiation.

ACP-SXM emphasized that its inquiry is not adversarial in nature. The association said it recognizes that SOL Antilles NV is a private commercial entity operating within the bounds of its agreements and applicable law. ACP-SXM also said it does not question SOL’s right to earn a commercial margin on fuel supplied to St. Maarten.

However, the association said the structure of fuel supply pricing to GEBE is not purely a commercial matter because it has direct and substantial consequences for every household and business in St. Maarten that depends on electricity.

ACP-SXM said that when more than 60% of a consumer’s electricity bill consists of an unregulated, unaudited and unverifiable fuel clause, and when the cost inputs behind that clause are opaque, consumers are structurally denied the ability to assess whether what they pay is fair.

The association said its mandate is to safeguard consumers and that transparent engagement from all parties in the energy supply chain, including SOL as the sole fuel supplier, is essential to that goal.

ACP-SXM has requested a written response from SOL Antilles NV within fourteen calendar days from the date of the letter. The organization also invited SOL or a designated representative to meet with ACP-SXM to discuss the matters directly and said it would accommodate SOL’s scheduling preferences.

ACP-SXM said it looks forward to SOL’s response and remains committed to pursuing transparency, accountability and consumer protection in matters that determine the cost of essential public utility services in St. Maarten.

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