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Solar Swells in Barbados; Capacity Set to Double in 2016


Recent legislative changes in Barbados present an attractive opportunity for solar investors and developers. Learn more in the Barbados Solar PV Market Insightreport.

The last two years has seen the installed solar PV capacity of Barbados increase five-fold from 1.6MW in 2013 to over 9MW in 2015. The country will see the solar capacity double in 2016 when Canadian energy firm Emera completes construction of their 10MW utility scale project in August next year. This project will be a solid step towards the island’s clean energy target of 29% renewable electricity generation by 2029.

As a Caribbean solar thermal leader for the past 40 years and being in the global top five per capita installed solar hot water heaters, the island is now transitioning this experience into the solar power industry.

From solar water heating to solar electricity

Since the 1970s solar hot water collectors began dotting the rooftops of Barbados. In 2015, these flat plate solar collectors are ubiquitous and utilized by 80-90% of residences, according to IRENA. The popularity of solar energy with both the government and the public created favorable conditions for solar energy harvesting to evolve from limited solar water heating applications to expansive solar electricity.

Solar photovoltaic development in Barbados has progressed through three distinct phases.

Phase 1: Pre-RER (Pre-Renewable Energy Rider)

The first use of photovoltaic systems was for telecommunications to power microwave repeater stations and navigational aids in remote areas. Encouraged by the success of the solar water heater industry which began in the 1970s, the government aimed to have similar success with solar PV. Several demonstration projects were installed by the end of the 1990s to achieve this objective. Due to the early stage of the technology and high prices, by 2001 the installed solar PV capacity was a mere 37kW.

Phase 2: RER (Renewable Energy Rider)

In 2010 the utility company, the Barbados Light and Power Company, decided to submit a proposal to the regulator for the establishment of a Renewable Energy Rider (RER) to facilitate the sale of excess electricity to the grid by customers using a solar PV or wind renewable energy system to offset electricity consumption from the grid. A net billing with rolling credit and buyback methodology was used based on the avoided fuel costs.

The proposed RER rates were accepted by the regulator in March 2010 for a two year pilot program, beginning in July 2010, until 200 customers had connected systems or until the cumulative installed capacity reached 1.6MW.

The pilot program was successful and in 2013 the regulator granted the utility permission to make the Renewable Energy Rider permanent. As of July 2015 the installed distributed solar PV capacity in Barbados was over 9MW of a 20MW capacity limit. Results of a GE Energy Consulting Intermittent Renewable Energy Integration Study found that an additional 25MW of capacity can be installed with grid mitigation measures, bringing the total potential distributed solar PV capacity to 45MW.

Phase 3: ELPA (Electric Light and Power Act)

Being cognizant of improvements in power generation technology and aiming to reduce the US$400 million fuel import bill (50% of which is used to generate electricity) the government revised 116 year old power generation legislation.

The Electric Light and Power Act 2013 (ELPA) was enacted on May 4th, 2015. It is intended to promote the generation of electricity from renewable energy sources and now enables new entities to supply electricity in addition to the utility company. Based on the GE Energy Consulting study, 15MW of wind power and 20MW of central solar PV can be accommodated on the island’s grid.

Solar opportunities in Barbados

As with other Caribbean nations, Barbados is known for abundant sunshine. It has an excellent solar resource with an average 5.6 (kWh/m²/day) hours of solar radiation. Compounding the solar opportunity are high electricity prices as a result of importing fossil fuels. Even with the drop in oil prices the price of electricity is in the US$0.20-$0.25/kWh range.

Many countries are sunny and contend with high electricity prices but have yet to implement solar power in a significant way. Wide-scale solar integration in Barbados is being built on two key pillars often missing in other jurisdictions: a supportive government and a progressive electric utility.

Pillar #1

The Barbados Government has provided regulatory certainty and financial support for the solar hot water heating industry over 40 years and across successive governments. That support has extended to the solar photovoltaic industry with key legislative changes such as ELPA, financial and customs incentives.

Pillar #2

Government alone is not enough to drive solar adoption; it requires a synergistic partnership with an electric utility. Canadian energy firm Emera Inc. and its subsidiary the Barbados Light and Power Company are progressive and meet that condition. The utility is embracing rather than fighting the shift to renewable energy generation. It envisions a100% clean energy future for Barbados and is adapting to suit, most noticeably with the construction of their 10MW solar project.

Solar challenges

The trajectory for solar development is impressive; however, there are three key challenges which can be overcome by non-technological solutions in the form of investment and strategic development partnerships.

1. Government bureaucracy

An August 2013 presentation by the Central Bank of Barbados entitled “The Barbadian Economy: Challenges and Opportunities” cited inefficient government bureaucracy as the most problematic factor stifling business in Barbados.

To address this concern in the context of solar development, the government has established an Electric Light and Power Advisory Committee comprised of nine experts from the fields of engineering, renewable energy, law and accounting. The purpose of this committee is to advise the Minister with responsibility for Energy on the award of electricity supplier licenses.

2. Access to financing

The most cited hurdle blocking solar PV implementation worldwide is the high upfront capital cost. The situation is made more challenging in regions like the Caribbean due to limited access to venture capital and financing. Although some financing is available, lenders are generally not familiar with the technology and as such set higher interest rates which restrict the uptake of solar power.

Development banks from the US, Canada, Europe and Asia are collaborating with the Barbadian government to provide increased access to financing. As a developing nation, and particularly as a small island developing nation, Barbados is beginning to benefit from millions of dollars worth of renewable energy and nation development funds. Private sector financing entities and private investors who have experience with renewable energy finance are also entering the space to overcome this challenge.

3. Labor force

Prior to ELPA, there were certain size restrictions on the maximum permissible solar photovoltaic projects in Barbados. As a result, the labor force has experience up to the small commercial scale, approximately 150kW. From a sheer project volume perspective, the majority of installations have been residential with smaller portion attributed to commercial ones. The enactment of the Electric Light and Power Act will open the Barbados solar industry to increased commercial and utility scale development.

The challenge of ramping up installation labor force capacity to meet this demand is being undertaken by international and national training. Organizations such as Solar Energy International have conducted contract training on the island for local installers. Through a partnership with Canada’s Sault College, local trade school the Samuel Jackman Prescod Polytechnic is offering solar installer training to grow the national solar labor force. For ELPA utility scale projects, international developers can mix a team of their installers with those on the island for project construction.

Barbados Solar PV Market Insight

With a high potential for solar PV, but limited solar market information available, Solar Genesis Inc. has produced the Barbados Solar PV Market Insight, the industry’s most in-depth source of information for this emerging market. The objective of the report is to provide the necessary information to enable strategic business decisions by prospective solar developers and potential investors in the Barbados solar market. For more information please visit the reports page.


Category/ies:Barbados News, News, Renewable Energy, Solar Energy.
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