Wed | Jan 23, 2019

JPS gets green light to build 190MW plant

Published:Thursday | March 24, 2016 | 12:00 AMMcPherse Thompson
The oil-fired JPS power plant in Old Harbour Bay, St Catherine is to be replaced with a gas-fired plant.

Jamaica Public Service Company (JPS) says the National Environment and Planning Agency (NEPA) has approved the construction of the 190-megawatt gas-fired power plant at Old Harbour Bay, St Catherine.

The Office of Utilities Regulation and the Electricity Sector Enterprise Team have also given formal approval of the power purchase agreement for the new facility, the power utility said.

JPS President and CEO Kelly Tomblin said the utility was now finalising details of the project with equipment supplier General Electric Corp, and engineering procurement and construction company Power China. The latter company has been contracted to build the plant.

The arrangements for the project are to be finalised within the next two weeks.

JPS' disclosure of the project approval follows its weekend announcement, via a posting on its website, that it had finalised an agreement with New Fortress Energy to supply the Old Harbour plant with natural gas.

"We are now at an advanced stage in relation to closing the financing of the project, which we expect to be completed by the end of April," said the JPS chief executive.

New Fortress is also the utility's gas supply partner for the power plant at Bogue in Montego Bay.

The Old Harbour plant will be a brand new facility. Once built, JPS plans to dismantle the current oil-fired plant at Old Harbour and return the site to brownfield status.

"We anticipate that this new power plant will be generating electricity at below 13 US cents per kWh when it comes on line, which is remarkable, given the necessity to build new infrastructure and bear the transportation and other logistic costs," Kelly said.

The timelines for the project were laid out during last November's public consultations on the environmental impact assessment report.

JPS said yesterday that there are no changes to the timeline for site preparation for the liquefied natural gas plant, which is scheduled to begin in the first quarter of 2016, giving the utility just days to hit that deadline.

Construction will begin by the second quarter and the plant's commissioning is expected by July 2018.

JPS entered into a memorandum of understanding in December 2015 with a Chinese company, now identified as Power China to build the 190, megawatt plant.

The Chinese company replaced the Spanish engineering and renewable energy firm Abengoa, which filed for bankruptcy protection just days after striking a deal with JPS.

The Jamaican utility reaffirmed on Wednesday that the 190MW project is expected to cost around US$300 million.

The gas component, which includes development of a terminal and pipelines to the JPS plant, is a separate project to be undertaken by New Fortress. The arrangement is similar to that agreed for the Bogue plant.

JPS also already had dealings with General Electric, which is converting the diesel-fired Bogue plant to a combined cycle operation to burn either diesel or LNG.

The conversion is costing JPS US$22.74 million or about $2.7 billion, and is scheduled to wrap up by midyear.