Government updating its National Energy Policy (2009-2030)

Durrant Pate/Contributor

Jamaica’s plan to increase the contribution of renewable energies to 50 per cent from 30 per cent by 2030 will require investment of US$1.2 billion.

This was disclosed by Power Generation Systems Consultant at the Office of Utilities Regulation (OUR), Valentine Fagan during a panel presentation last week discussing the new renewables target.

Fagan explained that the new 50 per cent mandate is forecast to reduce annual fossil fuel imports by 3.9 million barrel of oil equivalent and reduce CO2 emissions by 1.5Mt.

The island’s current installed capacity reaches 1,041MW, of which 83 per cent is thermo, primarily natural gas, and the remainder renewables (wind, hydro and solar). Peak demand in 2030 is forecast to reach 678MW from 644MW last year.

“There is enough supply to reliably cover demand up to 2026, when 172MW of thermo capacity is due to be retired,” Fagan argued while providing a preferred portfolio plan for incorporating wind, hydro, solar and battery energy storage.

Changing landscape

Clean energy projects legal advisor, Elizabeth Butler, who was also a panelist, spoke about the imperative of increasing the island’s renewable energy mix, saying: “Jamaica must deal with the fact that the landscape is changing. The huge demand for international donor financing limits Jamaica’s access to what has been a reliable source in the past for early projects.”

Butler, through her law firm, Butler Law Offices, has worked with the Jamaican Government.

She said: “The ideal scenario is for Jamaica to leverage private sector investment through incentives and guarantees if needed but the great news is that Jamaica’s demonstrated success in prior project financing for renewable energy, solar and wind projects, shows that Jamaica has a proven track record and that these projects are viable.”

Nevertheless, she pointed to challenges related to providing affordable and reliable electricity during the transition, engagement with stakeholders and how to finance consumer-owned renewable and energy efficiency projects. Regarding consumer projects, Butler pitched the use of an integrated utility service model whereby financing is repaid on the monthly electric bill.

Concerns articulated by JPS

A third panelist, Vice President for Energy Delivery at Jamaica Public Service (JPS), Blaine Jarrett, expressed concern that “too much renewable energy capacity rolled in too fast could inflate system prices and rates and deteriorate grid reliability”.

Another concern laid out by Jarrett is the siting of projects far from transmission and distribution infrastructure and the associated cost implication.

Jarrett called for the use of near real term modeling of actual generation and demand metrics rather than relying on ‘synthetic’ data.