Mon | Feb 24, 2020

JPS $14b plan - Hunts Bay to be replaced, Old Harbour to power Kingston

Published:Wednesday | January 29, 2020 | 12:20 AM
A section of the newly commissioned power plant at Old Harbour, St Catherine, from which JPS will run transmission lines to feed power to Kingston.
A section of the newly commissioned power plant at Old Harbour, St Catherine, from which JPS will run transmission lines to feed power to Kingston.

Power utility Jamaica Public Service Company Limited, JPS, plans to spend nearly US$100 million ($14 billion) on two main projects to improve power reliability in the Corporate Area, including a new gas-fired plant to be commissioned in 2023.

The first project, costing US$37 million, will see JPS stringing up 43 kilometres of transmission lines from its new plant at Old Harbour, St Catherine, to one of its oldest plants at Hunts Bay in Kingston, a move designed to increase energy reliability for consumers and businesses, particularly in the capital.

Normally, the power for Kingston would come from the Hunts Bay station, but JPS plans to decommission part of that plant built several decades ago.

“With planned generation retirements and the growth of demand in the Corporate Area, the electric grid will not be able to safely or economically supply Corporate Area customers without a new transmission line to bring bulk power from the generation facility in Old Harbour,” stated JPS in its revised 2019-2023 investment plan uploaded to the Office of Utilities Regulation’s, OUR, website at mid-January.

JPS told the Financial Gleaner on Tuesday that Hunts Bay will be decommissioned in 2021, and that feeding power from Old Harbour to Kingston was not expected to negatively impact the St Catherine community.

“We have the capacity to serve all key areas and our plan is for Jamaica to have the smartest grid in this region. The export of power from Old Harbour to Kingston will have no adverse impact on Old Harbour and surrounding areas,” the company said.

The utility plans to finance the buildout of the Hunts Bay LNG plant with a mix of company-generated cash and debt.

The investment plan was submitted alongside a rate-increase request to the OUR by the power utility. JPS is seeking an average 4.69 per cent increase in electricity rates. The application as structured would see a 17.14 per cent rate increase for residential customers and a 14.06 per cent reduction for large industrial/commercial customers, the OUR said in a release.

The new LNG-fired plant in Old Harbour, at 190 megawatts, is nearly one-third of the grid’s capacity and can channel enough excess power to compensate for the 68.5MW set for decommissioning this year at the B6 steam unit in Hunts Bay. Overall, JPS will retire some 290mw of power spread across the original Old Harbour plant and Hunts Bay this year, but will add 310MW in new capacity over the same time frame – for a net gain of 20MW – which will increase reliability, JPS stated.

Then, JPS plans to build a “40MW plant at Hunts Bay using natural gas by the end of 2023”, and will replace another set of units totalling 40MW at Hunts Bay that are slated for decommissioning in 2023.

“This US$60-million investment in generation replacement will enable the retirement of 40MW of automotive diesel oil-powered turbines with 40MW of gas-powered engines. This will deliver superior efficiency, longer maintenance intervals, significantly lower carbon footprint, and will be the first natural gas-powered plant in the Corporate Area,” said the JPS business plan.

The overall investment and business plan was initially revealed in August, but the revised public document, released this month, contains more specific project information. JPS plans to spend some US$500 million on its upgrade over five years to 2023. This is higher than the US$416 million invested over the previous five years.

The Old Harbour plant commissioned last December 17 is operated by South Jamaica Power Company, SJPC, a JPS affiliate company, which will supply power to the national grid under a power-purchase agreement.

The plant cost US$330 million to build.

JPS will initiate 72 projects over five years aimed at reducing blackouts by 20 per cent and electricity losses by 2.30 percentage points. The power utility conducts five-year operational reviews as part of its rate adjustment review.

steven.jackson@gleanerjm.com