Jamaica is now developing its renewable
energy potential at a leading pace among its Caribbean neighbours with support
from private investment, says David Delaire, managing director, Germany-based
MPC Capital.
This is demonstrated by its 170
megawatts of installed wind generating capacity and rapidly developing solar
plants, he stated. The expansion underway in Jamaica is based on the country’s
appealing market conditions; robust regulatory framework; and government’s support
for the development; as well as, a utility company which is willing to work
with private power producers.
“We are getting about 8.5 cents per
kilowatt hour,” in respect of the price of electricity being generated by the MPC’s
Paradise Park solar plant being constructed in Westmoreland, Mr Delaire said. He
added that, “We also have a 20 year agreement with the Jamaica Public Service
Company (JPSCo) to purchase the power we produce.”
Most of the electricity produced across
the Caribbean, comes from diesel plants
that are more than 50 years old, which produce electricity at a cost
that is in “double digit” cents per kilowatt hour, he said. Mr Delaire declared
that, “These plants are obsolete.”
The low power production cost that the
Paradise Park plant can feed to Jamaica’s national grid, and the fact that the
national power utility company signed an agreement to take this electricity,
shows the benefits Jamaica gets from having reformed its electric power
industry to accommodate independent power producers.
He was speaking at an MPC Renewable
Energy Forum, mounted by JN Fund Managers (JNFM), a member company of The
Jamaica National Group, and MPC Capital at the Spanish Court Hotel recently. His
audience consisted mainly of potential investors in the MPC Clean Energy Fund,
which is financing regional renewable energy plant development.
“In
2015, CARICOM states agreed on a framework in which they outlined where each
member state needed to have a certain amount of renewable energy installed by
2030,” he said, pointing out that, “Jamaica outlined its National Energy Policy
2009 – 2030, thus carving out a role for the development of renewable energy in
the country’s future.”
“You have taken the time to outline an
integrated resource plan,” the engineer stated. “In terms of renewable energy,
what I find is more appreciated by investors such as ourselves is that we would
like to know that the government is behind rules.”
The
electricity sector development plan has involved regulators, the government ,
JPSCo, as well as the private sector, Mr Delaire pointed out, declaring that,
“Jamaica has done an exceptional job.”
Looking
at Caribbean counterparts, he said, Antigua has, “a couple of projects
installed or in development,” but others such as Guyana, Barbados and the
British Virgin Islands were all “a bit behind in terms of what they need to be
doing.”
Milverton Reynolds, managing director
of the Development Bank of Jamaica (DBJ), told the audience that the cost of
imported petroleum was what had prompted an change in Jamaica’s energy
policies.
The DBJ participated in a government
push to reduce the burden which energy placed on the national economy. Mr
Reynolds said that subsequently, “We ramped up our activities in our
privatisation and public/private partnership programmes; and, currently, we
have two major active privatisation projects. We are indeed very excited about
the possibilities they present.”
Jermaine Deans, deputy general manager,
JN Fund Managers, is spearheading the team which collaborating with the initial
public offer of the MPC Clean Energy Fund, and also providing support for the debt
refinancing of the state-owned Wigton Wind Farm.
“Pension funds need sure and reliable
returns,” Mr Deans told the audience of leading financial sector
representatives. “Investing in cost-efficient renewable energy projects provides
this requirement, and most of the time your cash flow will be indexed to the
United States dollar.”
“Assisting Jamaica to move the
renewable component of its electricity consumption from less than than 20
percent currently, to a targeted 50 percent by 2030, offers excellent
opportunities for portfolio managers,” Mr Deans stated.
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