With Chavez gone, what will become of his PetroCaribe program? Photo credit: Valter Campanato, Agencia Brasil

Among the questions arising after the death of Venezuelan leader Hugo Chavez is what will become of the PetroCaribe program he started in 2005 and upon which many Caribbean economies have become dependent. Since it began, PetroCaribe has become a much-needed lifeline to countries in the region that are overly reliant on fossil fuel imports to supply their energy and transportation sectors. However, it has also increased the unsustainable debt levels of these countries. What comes next is uncertain as Venezuela prepares to elect Chavez’ successor as president of Venezuela next month.

Chavez started PetroCaribe with the aim of helping neighboring countries bear the burden of oil dependence at a time when oil prices began to rise sharply. Touted on its Web site as a “shield against misery,” the program allows participating Caribbean countries to purchase Venezuelan oil under preferential conditions. At the outset, 50 percent of the payment was due within 90 days with the remainder being financed over an extended period, sometimes up to as long as 25 years. The interest charged on the balance was at 2 percent but fell to 1 percent once oil surpassed US$40 per barrel.

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Caribbean, Caribbean Sustainable Energy, Climate Change, Dominican Republic, fossil fuels, Haiti, Jamaica, Low-Carbon Development, renewable energy, south america, sustainable development, Sustainable Energy Roadmaps, Venezuela

While the Jamaican government’s efforts to increase renewable energy production have yet to produce significant results, some private enterprises are forging ahead on their own. Due to the prohibitively high cost of purchasing electricity from the national grid operator (around 40 cents per kilowatt-hour), many companies have found it is cheaper to generate their own electricity – often with renewable energy sources.

The Jamaica Broilers "Best Dressed Chicken" mascot looks forward to solar power. (Source: Facebook, Best Dressed Chicken)

The Jamaica Broilers "Best Dressed Chicken" mascot looks forward to solar power. (Source: Facebook, Best Dressed Chicken)

The Jamaica Broilers Group, the largest poultry producer in the Caribbean, is one of the companies pioneering the transition to renewable energy. As with many other industries and services in Jamaica, electricity is the largest single cost in chicken farm operations. In order to reduce this expense, Jamaica Broilers is currently installing solar photovoltaic (PV) systems – along with efficient LED lighting – at its chicken houses. The first phase of the project will install 15 kW systems at about 40 chicken houses by the end of March, for a total capacity of approximately 600 kW.

The project will cost an estimated US$10 million over two years. Rather than require that chicken farmers leverage their farms as collateral to purchase the solar equipment, Jamaica Broilers will facilitate obtaining supplies and financing to allow farmers to lease the equipment. Each participating farmer applies for the loan, which is financed by the Development Bank of Jamaica (DBJ) through the PanCaribbean Bank at 8.5 percent interest – a relatively low rate for the country. The expected payback period – that is, the amount of time it takes for reduced electricity costs to make up for the solar panel investment costs – is five to six years.

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Jamaica, renewable energy investment, renewable energy policy, solar power

Last month, Jamaica’s electricity regulator, the Office of Utilities Regulation (OUR), released recommendations for the country’s anticipated electricity wheeling program. Electricity wheeling has been proposed in Jamaica as a way to promote distributed power generation, especially from renewable energy sources. Under the proposed wheeling program, a company or individual could generate electricity in one part of the country and pay the grid operator – the Jamaica Public Service Company (JPS) – a fee to transport that power to another location where it will be used.

Wind power in Jamaica. Photo credit: Mark Konold.

Wind power in Jamaica. Photo credit: Mark Konold.

Because JPS currently has a monopoly on electricity transmission and distribution on the island, a company would only be able to send electricity over the grid to be consumed at a location that it also owns. For example, a sugar company that generates electricity at a sugar refinery using bagasse can send excess power to its offices in Kingston to avoid paying high electricity bills there, but cannot sell electricity to another entity.

Several of Jamaica’s large energy consumers are considering participating in the forthcoming wheeling program to support investments in renewable energy. Hotel chain Sandals)the Caribbean’s largest poultry producer Jamaica Broilers and the National Water Commission, the largest single electricity consumer in the country, all have plans to wheel solar power. A National Irrigation Commission project using wind energy to power irrigation pumps also wants to participate in the program.

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Caribbean, Jamaica, renewable energy, Sustainable Energy Roadmaps

Worldwatch's Shakuntala Makhijani presents early findings of the Sustainable Energy Roadmap for Jamaica.

Recently, members of Worldwatch’s Climate & Energy program traveled to Kingston, Jamaica to conduct a Stakeholder Consultation for the ongoing Sustainable Energy Roadmap project. The workshop comprised a morning session where the Roadmap’s early findings were presented to members of the country’s electricity sector followed by an afternoon dialogue addressing some of the key questions at the heart of the team’s ongoing research. The consultation came at a very key time as Jamaica is in the midst of some significant changes in the electricity sector while it faces an ongoing energy crisis.

The Sustainable Energy Roadmap for Jamaica is part of a multi-year project sponsored by the International Climate Initiative of the German Ministry of Environment. Worldwatch is examining recently assessed renewable resource potential, current energy policy frameworks, the potential for adding energy efficiency measures, technical challenges to renewable energy integration and underlying economic factors to try and help decision makers understand the choices available for making the country’s electricity sector more sustainable. Not surprisingly, the country has a tremendous solar resource, an average of 5 to 7 kilowatt-hours per meter squared per day (kWh/m2/day), similar to the Southwest of the United States. It also has strong wind potential including some significant locations off the Southeast coast of the island.

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Caribbean Sustainable Energy, electricity, emissions reductions, energy efficiency, Jamaica, low-carbon, Sustainable Energy Roadmaps

Jamaica's current generation mix is heavily oil-dependent. New energy policies call for diversification.

Jamaica is hostage to oil and needs to diversify its energy mix. Astoundingly, in 2010, the country’s oil imports exceeded its exported goods in value by 118 percent. Like most Caribbean island nations, Jamaica has limited domestic fossil fuels and relies heavily on outside sources to meet its energy needs. In 2010, it imported 20.5 million barrels of oil at US$1.62 billion, representing 11.6 percent of GDP.

The electricity sector accounts for 32.4 percent of Jamaican oil consumption and is the country’s second largest oil consumer, after transport. Ninety-five percent of domestic installed capacity is oil-based, compared with only 5 percent for renewables. As a result, the electricity sector is heavily susceptible to oil price fluctuations, and as prices rise, the country needs to look to other energy sources to provide power. 

In 2010, Jamaica elaborated a new energy policy that includes long-term targets for fuel diversification and renewable energy use. The plan stipulates that by 2030, the primary energy mix should include a 70 percent non-oil-based supply. Options include natural gas as well as a range of renewable energy sources, including wind, solar, and biomass.

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Caribbean, electricity, energy, Jamaica, natural gas, renewable energy

The Most Hon. Edward Seaga (UTech President & former Prime Minister), The Most Hon. Portia Simpson-Miller (Prime Minister) and H.E. Josef Beck (German Ambassador) at the Opening Ceremony on 16 May 2012. Photo courtesy of the German Embassy in Kingston.

Recently I was asked to participate in a Sustainable Energy Conference hosted by the Embassy of the Federal Republic of Germany in Kingston and the University of Technology, Jamaica (UTech). The four-day event, which included considerable participation from the Caribbean Renewable Energy Development Program (CREDP), was a great opportunity to highlight the importance of renewable energy and energy efficiency in Jamaica. It was also a chance to continue the important debate over how quickly renewable energy can be adopted on the island.

Jamaica is currently one of three Caribbean countries for which Worldwatch is preparing a Sustainable Energy Roadmap. This project, sponsored by the International Climate Initiative of the German Ministry of the Environment, will provide decision-makers in the Dominican Republic, Haiti, and Jamaica with a Roadmap containing concrete recommendations for promoting a more sustainable energy future.

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Caribbean, energy, energy policy, energy security, Jamaica, renewable energy, sustainable development

The Jamaican economy is highly energy inefficient. In 2008, the country’s energy intensity index ranked 47th in the world, at 8,937 btu per year 2005 U.S. dollar. The energy intensity index shows the energy efficiency of a nation’s economy; the higher it is, the more it costs to convert energy into GDP (Gross Domestic Product). Reasons for this high energy intensity include the energy demands of the bauxite and alumina industry, the inefficient public electricity system with its high transmission and distribution losses, inefficient energy use in the public sector, and low public awareness of the importance of energy conservation.

Worldwatch meets with Jamaica government officials to discuss energy issues. From left: Senior Director of Energy at the Ministry of Energy & Mining Fitzroy Vidal, State Minister Laurence Broderick, Worldwatch Caribbean Project Manager Mark Konold, and Sr. Engineer at Ministry of Energy & Mining, Gerald Lindo

Jamaica depends heavily on imported petroleum, which supplies 91 percent of domestic energy use. Transportation accounts for nearly half (47 percent) of the energy consumed, followed by the bauxite and alumina industry (30 percent), and electricity generation (23 percent). Despite the increase in world oil prices, Jamaica’s energy consumption has grown faster than its economy over the past decade. Given these realities, the Jamaican National Energy Policy for 2009-2030 aims to design and implement cost-saving measures to boost energy efficiency and conservation across the public sector.

In 2011, the Jamaican government set a target of reducing public sector energy consumption 5 percent below the 2010 level by 2015, mainly through public sector efficiency improvements. These include energy audits and building retrofits to replace lighting and air conditioning units, and improving building envelopes by implementing cool roof coatings and window films. Because reducing energy consumption also requires efforts of those who use public buildings, staff are expected to fully engage in the process by following the protocols in place. Education and knowledge dissemination about energy efficiency and conservation are a key component of this project.

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energy efficiency, energy intensity, Inter-American Development Bank, Jamaica, oil

On December 29th, the Jamaican government called for a general election which resulted in a changing of the guard from the Jamaica Labor Party (JLP) to the People’s National Party (PNP). The PNP, led by Prime Minister Portia Simpson-Miller, assumes control of the government after having lost it to the JLP in the summer of 2007. With this change, many questions arise regarding current initiatives, especially those concerning energy. Despite many signals that the country is moving toward a more sustainable energy future, including a renegotiated contract to help make Wigton Wind Farm profitable, official legislation for net billing, and the rehabilitation of hydroelectric facilities, energy prices continue to burden most consumers and the country’s energy future still remains unclear.

election map, courtesy of Jamaica Observer

A map of Jamaica showing the election results from December 2011. Source: The Jamaica Observer

While both the PNP and JLP support renewable energy initiatives in their rhetoric, actual energy performance has been mixed. Until 2007, the PNP led the country for 18 years, and in that time the country’s first utility-scale wind farm was installed at Rose Hill. Its initial phase brought 18 megawatts (MW) of installed wind capacity to the island to complement the 21 MW of already-installed hydro power. The PNP also established the Office of Utility Regulation (OUR), which oversees, among other things, the island’s electricity sector.

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Caribbean, electricity, emissions reductions, energy efficiency, Jamaica

The Dominican Republic is one of the few Caribbean nations to have LNG import capability - will Jamaica be next?

On November 14, the government of Jamaica began evaluating six proposals from companies hoping to supply liquefied natural gas (LNG) for a planned floating LNG storage and regasification terminal. The terminal, for which bids will be submitted on January 13, 2012, would provide Jamaica with its first supplies of natural gas, a fuel that the government believes will play a leading role in reducing the country’s dependence on expensive heavy fuel oil imports. Jamaica currently spends 13 percent of its GDP on importing energy.

Jamaica has been seriously exploring the potential for importing LNG since 2001, and in 2004 signed a Memorandum of Understanding with Trinidad and Tobago to import gas from its Caribbean neighbor. Although this deal was shelved in 2006, LNG remained a centerpiece of Jamaica’s fuel diversification strategy in its National Energy Plan, released in 2009, which also contains language supporting the development of renewable energy sources in the country’s electricity mix. Jamaica’s Office of Utilities Regulation  (OUR) 2010 Generation Expansion Plan compared three scenarios for the expansion of Jamaica’s fossil energy system through 2030 – a natural gas scenario, a coal and natural gas scenario, and a business as usual (heavy fuel oil) scenario – and found that the natural gas strategy would cost the least (US $5.77 billion versus US $5.85 billion for the coal and gas scenario and US $8.18 billion for the business as usual scenario). This year, with requests for proposals announced for both the terminal and the LNG to supply it, this strategy has begun to take on a definite shape.

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Caribbean, Jamaica, LNG, Low-Carbon Development, renewable energy

Mr. Gerald Lindo is a Senior Energy Engineer with the Ministry of Energy & Mining in Jamaica

From left to right: Fitzroy Vidal, Senior Director, Energy, Ministry of Energy & Mining; Honorable Laurence Broderick, MP; Mark Konold, Caribbean Energy Roadmap Project Manager, Worldwatch; Gerald Lindo, Senior Energy Engineer, Ministry of Energy & Mining

On September 19th, a group of engineers met in Kingston, Jamaica during the Annual Conference of the Jamaica Institute of Engineers (JIE) to discuss the future of Jamaica’s energy sector. This year, the first two days of the week-long event were devoted entirely to discussing the country’s energy challenges and the way forward. The Principal Director of the Energy Division in Jamaica’s Ministry of Energy and Mining (MEM), Mr. Fitzroy Vidal, gave one of the keynote speeches detailing Jamaica’s National Energy Policy (NEP) and the progress towards its implementation.

It was a brisk and upbeat meeting, and Mr. Vidal’s speech was well received. Questions abounded on the direction of Jamaica’s energy sector and on the proposed considerations of innovative green technology solutions aimed at ensuring the country’s energy security and long term sustainability. However, underneath the cordiality and spirit of the conference was a smouldering worry, an elephant in the room: the tremendous price that Jamaicans pay for electricity.

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Caribbean, energy efficiency, feed-in tariffs, hydropower, Jamaica, renewable energy, solar power, wind power