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Joint venture targets $2M wind farm in Bahamas

A RENEWABLE energy consortium is aiming to extend the first independent power production contract signed by the Government into a $12-$15 million deal that would see its winds farms power a further six reverse osmosis plants, telling Tribune Business its energy supply reduced operating costs by 30 per cent.

Vincent McDonald, chief executive of Winso Company, the 49 per cent Bahamian partner in the group that has constructed a $2 million wind farm to supply the General Electric (GE) owned reverse osmosis plant at Tarpum Bay, said they were hoping to sign a binding Memorandum of Understanding (MoU) to provide energy to a further six plants – planned for the Family Islands – by year-end.

Explaining that the agreement signed for the Tarpum Bay plant would see the consortium provide power for a fixed 20-year period, Mr McDonald said it would the wind farm would supply electricity at a fixed price of $0.20 per kilowatt hour, a cost 43-46 per cent below the Bahamas Electricity Corporation’s (BEC) $0.35-$0.37 per kilowatt hour.

Telling Tribune Business this would reduce the Tarpum Bay plant’s operating costs by 30 per cent, a savings that could be passed on to consumers, Mr McDonald said the agreement with the Government provided a massive confidence boost to renewable energy companies and investors.

Suggesting it showed the Government was serious when it came to tapping into renewable energy sources, he said the ‘green-lighting’ of ventures such as Winso’s tie-up with US-headquartered Schneider Power, would reduce the Bahamas’ dependence on fossil fuels and generate some employment growth.

“It’s a very encouraging move by the Government to be the initiator in trying to do something of this magnitude,” Mr McDonald told Tribune Business. “It’s [the wind farm] tied directly into the desalination plant, and is a 20-year power purchase agreement.

“We’re selling it at $0.20 per kilowatt hour, which is cheaper than BEC, which is selling now at $0.35-$0.37 per kilowatt hour. It will reduce the cost of operations for the Water & Sewerage Corporation, and reduce the costs to the end user, the consumer. It will reduce operating costs by 30 per cent.”

Mr McDonald said that while the amount of power generated depended on the wind, the Tarpum Bay wind farm could produce one million kilowatt hours, or 1 Mega Watt (MW), of energy per annum – something that could also power 400 homes. The wind farm was also designed to resist 130 mile per hour winds, and the turbines themselves were designed for removal if a hurricane approached.

Eleuthera Wind Power, the consortium in which Schneider Power holds a majority 51 per cent stake together with Winso, has employed wind turbines designed by French manufacturer Vergnet for the Tarpum Bay project.

All electricity it produces will be acquired by the Tarpum Bay reverse osmosis plant, which is being operated by GE subsidiary Aqua Design. All the water it produces will be acquired by the Water & Sewerage Corporation, and used to supply its Eleuthera customers.

Disclosing that it cost Eleuthera Wind Power some $2 million to construct its wind farm, Mr McDonald said the consortium had already signed a non-binding MoU to provide energy to other planned reverse osmosis plants. These included a further two in Eleuthera, and others in Bimini, Exuma, Moore’s Island and San Salvador.

Converting this into a binding MoU is dependent on the approval of Eleuthera Wind Power’s Board and Schneider, the receipt of necessary financing and government approval.

The power purchase agreement is also subject to meeting certain conditions, including successful completion of a 12-month wind study; an environmental impact assessment and related approvals and building permits. The Eleuthera Wind Power consortium is hoping to obtain all necessary permits by end-2012 for the start of pre-construction activities.

“We’re looking to have this amended by the end of the year,” Mr McDonald said of Eleuthera Wind Power’s hopes to convert the non-binding MoU into a binding agreement.

“Bear in mind this is going to cost anywhere between $12-$15 million for the seven plants total. Obviously it will create jobs, create tax revenue, give a good education and a lot of diversification in the economy.”

Mr McDonald added that Eleuthera Wind Power would need three-four persons at each wind farm to monitor and oversee operations, meaning that between 21-20 jobs could be created on-site if all seven came off. Additional administrative staff were also required, and two wind farms were likely to be larger than the others.

Pointing to the spin-off entrepreneurial and employment opportunities that could be generated through supplying services to the wind farm, Mr McDonald said Eleuthera Wind Power had already hired construction, engineering and environmental firms.

“It lends a lot to the country, education, technology transfer to the locals. It hits all the buttons. It’s good for a sustainable economy,” Mr McDonald said of renewable energy projects like his group’s.

“We’re less dependent on fossil fuels. It gives us a bit more confidence to have sustainable growth in the economy, and have a reduced cost of living.”

Describing the contract with the Government as “a great first step”, Mr McDonald said the arrangement showed it was serious when it came to renewable energy adoption, and that wind power worked.

The key now, he added, was for the Government to further incentivise renewable energy suppliers and independent power producers through reforming the regulatory and policy framework governing the Bahamian energy sector.

This, Mr McDonald said, would have “an amazing impact” through reducing business and living costs. It was also important for the Bahamas to move forward, as many other Caribbean countries were ahead of it.

“This is a great step and confidence the Government has demonstrated in renewable energy, and we’re very proud to be the recipients of a first power production agreement issued by the Government,” he added.

Source: The Tribune

Category/ies:Bahamas News.
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