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Commentary: What Will it Take to Develop More Renewable Energy in the Caribbean?

Robert Blenker is President and CEO of WRB Energy. WRB Energy develops renewable energy projects to help stabilize electricity prices and reduce dependence on imported fuels to drive economic growth and sustainability in Latin America and the Caribbean

With the abundance of clean energy resources in the Caribbean — sun, wind, water and geothermal — it’s a natural environment for more renewable energy generation. Undoubtedly over time, renewable energy projects developed appropriately can stabilize electricity costs, reduce dependence on fuel imports, combat climate change, and foster energy independence for small island nations throughout the Caribbean.

So why isn’t there more renewable energy produced in the Caribbean energy sector, and why aren’t there more renewable energy projects in the pipeline?

Having worked in the region for more than three decades developing renewable energy resources and operating utilities in Grenada, Jamaica, Dominica, and Turks and Caicos, as well as in Latin America, WRB Energy can address some of the challenges that hinder increased renewable energy generation in the Caribbean. Our first-hand knowledge and experience on the ground can help shed some light on overcoming the obstacles for increasing sustainable clean energy production.

First and foremost, contain costs

The reality is that most small Caribbean island nations lack economies of scale to absorb the high costs and complexities of developing relatively small renewable installations as compared to those in larger, more developed countries. With relatively smaller populations, economies and electricity demand, there are simply fewer kilowatt-hours produced to amortize the upfront investment expenses cost-effectively. However, as the prices for renewable energy equipment continue to decrease and technologies advance, solar, wind, and geothermal are increasingly more viable, least-cost options for diversified energy portfolios.

Flatten the learning curve

We believe that governments with a stable long-term vision and implementation plans for increased renewable energy attract the best opportunities for project development. By working collaboratively and transparently, Caribbean utilities, government, and regulators can help level the learning curve for initial projects. As energy providers, regulatory bodies and ministries get up to speed on the process and requirements, more renewable energy will be incorporated to meet the aggressive renewable energy targets set by many Caribbean nations.

As an example, in 2016, WRB Energy found Jamaica to be well-organized and open to adhering to productive processes and best practices to help realize the benefits of solar and wind. WRB Energy’s 28 MWp Content Solar site developed in Clarendon, Jamaica, followed very structured and rigorous tender and contract processes. This helped to facilitate a successful project completion for all parties involved, including the Jamaica Public Service Company, government ministries, regulatory bodies and investors. All participants worked collaboratively to execute, develop and deliver the project, on-time and on-budget.

Land is precious

Securing appropriate land for project siting poses significant challenges. In the Caribbean, there is tremendous pride in land ownership, with small parcels of land being passed on from generation to generation. Sadly, there is also a history of very informal and murky land dealings, which leads to clouded property titles.

Consequently, these issues can create local owner resistance to land transactions and long-term lease agreements for fear of not being compensated or paid fairly. Also, if available land is inhabited, the added expense of relocating people and buildings is a factor negatively impacting project capital costs.

Additionally, rugged or volcanic terrain can cause higher transportation and construction costs. It is difficult to find large, flat parcels of land conducive to renewable energy development. Mountains, hills and rocky, uneven roadways trigger higher costs for transporting large equipment and project site preparation.

Also, some port facilities in the Caribbean have limitations on the size and amount of equipment being imported. The volume of photovoltaic panels, but perhaps more importantly, the sheer size of wind towers, transformers and blades, being imported for a site can exceed the limits of what many ports can accommodate.

Simplify permitting

Site selection and permitting crosses many functions of ministries and parishes, including departments of energy, utilities, environment and labor. It’s not a one-stop shop to permit a project. Multiple government and regulatory offices are involved, each with their individual timeframes and requirements that often overlap. Coordinating with several ministries to review, process and approve renewable sites adds more time, administration and expense to the projects. Streamlining procedures would help improve efficiency immensely.

Clarify investment requirements

Banks, investors, and multilateral organizations have universally-required mandates, terms, securities and covenants that can be misunderstood in negotiations with governments, utilities and regulators. For example, the “waiver of sovereign immunity” is often interpreted as an insult to Caribbean government officials. Again, the policies and processes need to be clearly defined and as transparent as possible to avoid misunderstanding project terms and requirements. Invest in Skilled Labor and Training

In the Caribbean, there is limited local renewable energy technical expertise and experience. It’s difficult to find local EPC and O&M contractors to construct and oversee operations of a renewable site. Bringing in contractors from other countries can be expensive. WRB Energy has invested substantially in hiring and training local resources to develop and manage projects.

Harness a sustainable future

We foresee a bright future for renewables in the Caribbean. We believe in thoughtful, respectful policy and regulatory reform based on facts and economic analysis. We applaud nations that are sharing and learning best practices from each other, as well as developers, utilities and policymakers who understand that renewable energy is intermittent. The existing electricity infrastructure needs to be maintained while more renewable energy is brought online through large-scale installations, distributed generation, microgrids and energy storage.

Accommodating and integrating more renewable systems reliably, safely, and affordably requires due diligence and prudence to avoid electricity rate increases. It’s a long-term strategy requiring cooperation between stable government policies, flexible utilities, competent regulatory bodies, responsible investors, and credible development partners to design, develop and deliver renewable energy projects as promised.


Category/ies:Articles, Clean Energy, Dominica Articles, Grenada Articles, Jamaica Articles, Regional Articles, Renewable Energy, Turks & Caicos Articles.
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