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Homegrown energy solutions needed

 

Homegrown solutions are needed to deal with the development of the renewable energy market. 

 

This is according to Adrian Carter, 2014 De La Rue Scholar and Former Central Banker, who also noted that the development of the renewable energy market and photovoltaic energy requires regulation, but also solutions to deal with this growing market and how it will impact the country.

 

Carter, who is presently a market analyst at the Barbados Light & Power Company, in his research paper tackling one of the challenges of the increase in photovoltaic energy, stated, “The growth in photovoltaic penetration is phenomenal. We expect this area of the market to continue to grow, but this growth will also bring challenges to the market, that has to be addressed using unique methods because of the uniqueness of our market. 

 

“Regulators are trying to find solutions, but the regulators and utilities don’t share their challenges in regulating this market. I am confident we in the region have the ability to come up with homegrown solutions to ensure the introduction of renewable energy and photovoltaic energy to contribute to the rise of our economies.”

 

In his address yesterday at the Central Bank of Barbados’ 34th Annual Review Seminar on ‘Caribbean Economies: At Risk or on the Rise?’ at the Radisson, he outlined, “We have seen an explosion in the influx of photovoltaic generation in the county that has resulted from a number of factors such as the Renewable Energy Rider that has been instituted by the electric utility that has allowed customers to install systems and sell back any excess. 

 

“What has changed the economics in installing these system is the suite of incentives the Government has put in place to facilitate the growth in renewable energy generation, also the cost curve for installing these systems have been declining, these factor have combined to create a situation where a market has now emerged. Individuals and companies have seen an opportunity to make a profit in this market and we have seen the development of a number of businesses that have been formed specifically to deal with this market. My research study has found around 30 companies that have emerged. There is an explosion in growth in this area and this market segment is now providing direct competition to the incumbent electric utilities in the region.”

 

Major growth in photovoltaic 

He recounted, “The renewable energy programme started in 2010 and it was very slow up to 2012. By the end of 2012 growth has picked up significantly. The payback of these photovoltaic system is between three to four years, which means these systems are commercially viable and installation of these systems are a no-brainer – once you have access to the money to purchase these systems you should install. 

 

“This exponential growth is happening at the same time that sales and demand of electricity from the utility grid has been declining and this becomes a major regulator issue because the majority of the utility cost is actually fixed, that means that when sales decline, demand from the grid decline. However, the company cost does not decline simultaneously with the fall in demand and thus it creates an issue of cost recovery for the utility which is made worse by the intermittent nature of the photovoltaic generation.”

 

Regulation
Carter indicated, “[The] Regulator must set a limit for photovoltaic, which is 7 megawatts and by the end of the year I expect we will be there. That creates an issues because what will happen to this market? This is a very difficult situation for the regulator and utility and the issue needs to be addressed. 

 

“The regulator can increase the amount they can allow on the system, but the better solution is to ask customers to install energy storage along with their photovoltaic installation … or ask the utility to invest in smart grid infrastructure. It is not an easy solution because it will impact the market, but how do we ensure that renewable energy customers pay their fair share of the cost associated with being a customer on the grid?” 

 

Source: http://www.barbadosadvocate.com/newsitem.asp?more=local&NewsID=37725



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