Cabinet approves draft terms for modernised electricity licence

Draft terms for a new all-island electricity licence, scheduled to take effect in 2027, have been approved by Cabinet, Energy Minister Daryl Vaz announced on Wednesday.

He explained that the Heads of Terms document outlines the principal features of the proposed licensing framework.

“In November 2025, the ministry entered a new contract with Francis Maude Associates (FMA), representing phase one of a structured three-phase reform process to establish a modernised licence framework,” the minister said at a post-Cabinet news conference at Jamaica House.

FMA is a United Kingdom-based global advisory firm founded in 2016, specialising in helping governments and public sector organizations implement reform, reduce costs, and improve services.

Vaz noted that the initial phase of the process will run until April. This stage is focused on establishing the key commercial, regulatory, and legal foundations that will underpin the new licensing regime.

“Work is being carried out by a dedicated electricity licensed negotiation team comprised of officers of the Ministry of Energy, Transport, and Telecommunications; Attorney General’s Chambers; Ministry of Finance and the Public Service; the Office of Utilities Regulations (OUR), as well as energy specialists from the private sector and academia,” he informed.

The minister stated that once the detailed legal structure has been finalised, formal negotiations will begin with the Jamaica Public Service Company (JPS).

“Beginning April ’26, Francis Maude Associates’ broader work stream schedule will advance into a 16-month sectoral framework development and implementation phase,” Vaz explained.

He noted that this includes the preparation of a new Electricity Act, amendments to the Office of Utilities Regulation (OUR) Act, strengthened enforcement provisions, renegotiation of power purchase agreements, updated policies to address system losses and enhance grid resilience, as well as the publication of a draft White Paper outlining the full scope of reforms.

Vaz added that the process also establishes structured pathways depending on the outcome of negotiations. These include potential new licensing arrangements for transmission, distribution, and generation; transition support for government valuation mechanisms where required; and, where feasible, the competitive engagement of alternative operators.

“This approach is deliberate, structured and reform-driven. It assures that, by 2027, Jamaica will have in place a modern, transparent and resilient electricity licence framework that protects consumers, strengthens regulations, attracts investment, and aligns the sector with the country’s long-term development objectives,” he stated.

The current licence is set to expire in 2027.

- JIS News

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