Analysts estimate savings could be more than US$1 billion
Jamaica could chop around US$1.2 billion per year off its oil import bill if it moved resolutely to install solar energy facilities throughout the country, say analysts of that CARICOM state’s power generating sector.
And if it pushed the substitution of wind energy with equal force, that savings could be more than doubled, to around US$2.8 billion per year.
Current electricity prices of about US$0.32 per kilowatt hour (kWh) could fall to around US$0.25, including transmission costs.
The solar generation cost itself would be US$0.10 per kWh. Onsite generation for large industrial plants, such as those in the bauxite and alumina industries, could be around US$0.15 per kWh.
Wind energy could lead to the same US$0.25 cost as solar, including transmission. Of course, solar and wind cannot provide “base load” (continuous) electricity because of their intermittency.
Solar irradiation in Jamaica, accounting for cloudy periods, is slightly more than 12 hours a day. Wind power is less predictable, since it depends on how strongly the wind is blowing at any particular time.
A 50 percent capacity factor for both solar and wind at least means that the contribution of RE helps to reduce overall electricity generation costs. All this has proved very enticing to the Jamaicans, both in the public and private sectors.
The People’s National Party (PNP) government has launched what it calls an “energy efficiency and conservation project” (EECP), at a cost of US$20 million, funded largely by the Inter-American Development Bank (IDB).
According to Jamaica’s minister of science, technology, energy and mining, Phillip Paulwell, “a solar contour application” was installed by the country’s Civil Aviation Authority (CAA) which saved US$28,000 per year in electricity costs, reducing consumption by 25,000 kWh.
Other agencies employing solar energy facilities include:
- The Spanish Town police station, which shaved US$2,300 per year off electricity costs
- The National Housing Trust with savings of US$30,000 per year
- The Jamaica Development Bank (JDB) with savings of US$17,000 per year
These may be considered modest savings on a public-sector electricity bill which amounts to around US$121 million per year, but Minister Paulwell is nonetheless optimistic and insists he can achieve a 30 percent reduction in power costs by a combination of RE and energy efficiency, the two cardinal principles of the CARICOM Energy Policy (CEP), adopted in March 2013.
He insists he will not be sidetracked by lower oil import prices, which, it is feared, will dampen the enthusiasm of some CARICOM states for the upfront expense incurred in installing RE facilities.
“Even if the price of oil falls further,” Paulwell declares, “we are determined to continue this effort because the money the government saves can be used in so many other areas.”
He has urged the private sector to follow the government’s example and expand its own small-scale solar self-generation activity. But not everybody in Jamaica seems swept off their feet by the prospects for solar.
Startup renewable energy firm Caribbean Energy Finance Co. Ltd (CEFCL) tried to interest investors in taking shares in its business in mid-April but so far has raised less than 50 percent of the US$4 million it is seeking to fund its plan for making solar photovoltaic (SPV) equipment for use in Jamaica and, eventually, the rest of the Caribbean, which is also slowly moving toward the adoption of solar energy.
The shares were priced at Ja$7.30. CEFCL also intended to move into other alternative energy technologies. Company management, which currently owns all of the issued shares, seems to have more faith in an alternative energy future than does the investing public in Jamaica.
Jamaican businessmen Leo Williams and Damian Lyn say they will proceed with investments in a solar-powered future for Jamaica, but on a smaller scale than would have been possible had the initial public offering (IPO) succeeded.