Angella Rainford-Heath, Guest Columnist
It is not often that we have a high level of interest to invest in Jamaica as we have now in the 115MW renewable energy process. Jamaica has received a very strong response from local and international investors with projects totalling more than 800MW.
The announcement of a partial award is deeply concerning, particularly as it is technically possible to reallocate the full 115MW to energy-only projects. At a time when our country is so in desperate need for greater energy infrastructure development, job creation and increased productivity, why turn away qualified investors?
The sad irony is that while we continue to put so much effort into advertising Jamaica as a country which is open for business, we are now leaving much of this interest unutilised.
Turning away qualified investors in a sector which is undoubtedly one of the most critical for our nation's sustainable development is counterintuitive. Combining this with the controversy which has marred the 360MW bid process sends a negative signal to the investor community and potentially damages Jamaica's reputation as a place to do business.
To be open for business is to have objective procurement processes with successful sustainable outcomes. More often than not, some of the projects awarded in tender processes fail to reach completion for a variety of reasons. Therefore, it makes sense to issue the full 115MW to mitigate the risk that some of the projects awarded may never be built.
The 115MW process gives us an opportunity to showcase Jamaica as a place for investment in a sector critical for our nation's development and growth: energy. Renewable energy is the energy choice of the future. Bloomberg New Energy Finance predicts that worldwide, 70 per cent of new power-generation capacity added between 2012 and 2030 will be from renewable technologies, and that wind and solar will account for 30 per cent and 24 per cent, respectively.
Around 95 per cent of the electricity-generating capacity in Jamaica remains based on imported oil. Even with the full award of 115MW, we will still be far from our National Energy Policy objective of attaining 30 per cent of electricity generated by renewable energy by 2030.
There remains a misconception that renewables are more expensive than conventional power sources and are, therefore, a luxury for countries looking to be more environmentally balanced rather than countries looking to reduce their energy costs. This could not be farther from reality.
Renewables are not only cost competitive in Jamaica, they can be deployed much faster, are more environmentally friendly, and have scope for creating a new industry in Jamaica given the technological advances taking place.
Fuel is free: Jamaica does not have deposits of oil or natural gas. We spend more than US$1 billion each year on oil imports with over a third of that going to generate electricity. In contrast, for renewables, the fuel component is a natural resource which Jamaica has in abundance and for which the fuel cost is zero. This means that the cost of fuel for renewables does not inflate with time, and so the cost of generation, in real terms, actually decreases, unlike fossil fuel-based systems.
Rapid build time: Solar energy projects, for instance, are well suited for rapid implementation, with typical build periods of less than a year for the scale of plants being proposed for Jamaica. In other words, a solar plant could be operational before the 360MW project breaks ground.
New industry development: The knowledge transfer of technology and skills would be transformational for Jamaica, not only on a national grid basis, but down to business and residential levels. There are several advances taking place in the renewables sector and it is, therefore, important for Jamaica to be part of this global shift and facilitate the investment not only in our infrastructure but also in our people in this new and exciting industry.
In conclusion, we, as a nation, have allowed many opportunities pass us by. Let us not add another one to that list. Let us meet the objective of awarding the full 115MW and let us move Jamaica closer to a more sustainable, productive future by leveraging our abundant natural resources. Let us show to the investor community, locally and internationally that, indeed, Jamaica is open for business.
Angella Rainford, managing director of UK-based Rekamniar Frontier Ventures and part of local-based consortium, Eight Rivers Energy Company. Email feedback to firstname.lastname@example.org.