Overview of Sustainable Energy

Development in Caribbean

Community

XVI Regional Forum:

Cogen, EE and Other RE in Central America,

Belize City, Radisson Hotel, November 9-11, 2010

Joseph Williams

Manager, Energy Programme

Caribbean Community

Sustainable Energy Development

• Sustainable energy is the provision of energy to meets the needs of the present without compromising the ability of future generations to meet their needs.

• Sustainable energy sources– All renewable sources,

• Solar, Wind-power, Hydropower, Geothermal, biofuels, Ocean, etc.

– Improved efficiency from use of energy efficiency technologies

• Note: Natural Gas as a cleaner fossil fuel source is considered to have significant role as a transition fuel

WHY?• Long Term Energy Security

– RE is only Indigenous Supply Option for many Countries; allows for diversification of supplies

– Hedge Against Oil Price Volatility; buffer against shocks

• Climate Change & Environment

– Clean Energy Source/Lower Carbon Footprint

• Economic Development & Poverty Reduction

– Jobs employment opportunity – manuf; servicing

– Energy Access Solution & Poverty Reduction (Haiti, Guyana, Belize, Suriname)

CHALLENGES OF CARICOM SIDS

The 5D’s

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• Dots (Small states)

• Discrete (most separated by Sea)

• Diverse (resources, structures)

• Debt (rel high indebtedness)

• Disasters (prone to natural)

CARICOM Context

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Energy

Total Energy Bill: USD 6.5 billion in 2004, to USD 12 billion in 2007 (Al Binger); est US$14B in 2008; exceeded food bill

Small peak demand approx 3,000 MW

Markets small and fragmented - small power systems – eg 10 MW

High dependence on imported petroleum and products

Electricity Utilities - About half has some private participation

Some of highest electricity tariffs globally (US45 c/kWh -08)

Energy Access vary widely (<25% Haiti, 100% in some OECS)

No cross-border electricity trading

Energy Consumption Trends – sample(Jamaica, Barbados, Guyana, Bahamas , Haiti )

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Power Generation and Transportation dominates Demand

Progress in SE Dev in CARICOM?

• Since first Oil Shock approx 3 years ago, countries identified importance EE and diversification supplies using indigenous REs

• Over the years intensity of effort varied with the price of oil.

• Small progress observed in last few years but still much too slow.

Today in CARICOM

• CARICOM Energy Programme to drive process

• 12 MS started ; 3 approved

• Heads declared on RE & EE

• T&T, energy leader-onboard

• Installations – 3 wind parks

• Production 2011; BNS finance

• E10 in Jamaica- transport

• IDB more $ than ever before

• Today: cipore.org

Three Years Ago in CARICOM

• No Energy coordination at Regional level; only CREDP

• Two draft policies

• No declaration on energy

• RE & EE not discussed in T&T

• 1 Wind Park – Wigton

• Geothermal – only talk

• Biofuels – Conceptual

• Multi-laterals - little to none

• RE info platform absent

CHALLENGES

1. Inadequate Policy Framework – Most CARICOM countries

have no established NEP

• For RE, Policy needed to level playing field

• For EE, Policy needed – for transportation sector eg. vehicle import, Appliance labelling, minimum building efficiency standards

ACTIONS

CARICOM Energy Policy

12 CARICOM Countries started developing policies; 3 approved

Regional & Sub-regional energy policy

CARICOM ENERGY POLICY Cont’d

Universal access to

sustainable and secure supplies

of energy

Diversification of energy

sectors as a foundation for

economic development

Optimization of domestic

production of energy in an

environmentally sound manner

Relationship between energy and international competitiveness

of regional industries

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Four pillars which underpin the regional policy

Status of Framework for RE & EE

Country & Pop Mil Energy Policy Regulation Elec Utility & Lic RE Access

Antigua & Bar 0.08 Draft started 2010 No Indepnt; Gov Pub – Act; Indefin 0 100

Bahamas 0.32 Draft started 2010 No Indepnt; Gov Pub/Pvt; Lic 2054 0 99

Barbados 0.27 Draft since 2006 Fair Trading Com Pvt; Lic 2028 0 100

Belize 0.32 No Policy PUC – Multi sect Pvt; Lic 2015 44 90

Dominica 0.075 Draft 2009 Indep; IRC Pvt-Unbundled 2015 25 100

Grenada 0.11 Draft 2010 No Indepnt; Gov Pvt; Lic 2073 0 99

Guyana 0.75 Expired 2004 IRC Pub; Lic 2024 0 90

Haiti 9.30 No Policy No Indepnt; Gov Pub; 20 25

Jamaica 2.7 Approved 2009 Off of Utility Reg Pvt/Pub; IPP; 2021 6 95

St. Kitts & Nvs 0.048 Draft 2009 No Indepnt; Gov Pub ; Act; Indefinite 0 95

St. Lucia 0.16 Approved 2010 No Indepnt; Gov Pvt; Lic 2045 0 100

St. Vin & Gren 0.10 Approved Policy No Indepnt; Gov Pub; Act; to 2033 30 99

Suriname 0.492 Draft RE Started 09 No Ind; Gov Reg Pub; Act; to 2022 95 79

Trin & Tobago 1.29 Draft RE Started 09 Indp Multi sectr Pub/Pvt – Indefinite 0 95

CHALLENGE

2. Legal & Regulatory Framework

• Utility Structure & Licence – By Legislation or Licence: Monopoly, Integrated, Long period of for licence

– Utilities traditionally don’t explore RE -risk, higher cost, lack of knowledge; Issues of intermittency, integrating issues

– Traditional expansion planning- give RE disadvantage

– Where liberalization and privatization effective regulation is needed to ensure market work

ACTIONS

• Some countries start reform process – BAH, DOM

• Model Legislation will be developed in 2011

• 6 Countries to be assisted

• Regional Workshop for key stakeholders on the transition

VERTICALLY INTEGRATED UTILITY

PARTIAL UNBUNDLING SINGLE BUYER MODEL

CHALLENGES 3. Limited institutional capacity

Capacity weak in ministries

4. Banks - Lack of knowledge of & confidence in RE & EE

5. Limited access to investment capital

– Fund, window, facility needed

6. Countries need lower oil prices, but this tend to make RE & EE solutions less attractive

ACTIONS(3). Capacity Strengthening; Panel of

Experts to be established

(4) Awareness building & capacity strenghthening; RETScreen

(5) IDB Smart Fund; Green Fund; WB risk guarantee mechanism; Access Mitigation fund CC

(6) Awareness week in All countries 2010; Joint effort by CC; EU, CDB; OAS

CHALLENGES

7. Sector based decision making and planning

8. Absence of baseline data

9. Lack of understanding of the importance and potential of energy saving and energy efficiency

ACTIONS

(7) Institutional arrangement to support inter-sectoral

(8) Part of C-SERMS to do region-wide baseline RE & EE

(9) Demonstrations in commercial & Industrial under I-SEAPS Project; Showcase all successes across region; EE Platform to be established similar to cipore.org

CHALLENGE

10. Small fragmented markets especially in electricity Sector

– Lack of economies of scale and scope

– Small land space

– High Tariff -partly because of need for large standby/ spinning generation reserve

OPPORTUNITY/ACTION

(10) Inter-connections of electricity systems (via sub-marine cable) & fuel market (pipeline)

• Preliminary study done

• Nevis to be connected to St Kitts – possibly 1st Project

• Dominica to French Departments Mart & Guad

– CARICOM/EU Infra-structural Fund

PROPOSED INTEGRATION INITIATIVES WITHIN CARICOM

Gas Market Eastern Caribbean Gas Pipeline:

• Tobago, Barbados,Martinique, St. Lucia,Guadeloupe

• 1,000 km

• Pipeline gas half ascostly as distillates

• Highly economic

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Adopted from the 2010 Study conducted bythe World Bank titled: Caribbean RegionalElectricity Generation, Interconnection, andFuels Supply Strategy.

Source: World Bank 2010

Regional Initiatives cont’d

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Electricity Market IDominica Interconnections

Geothermal• Dominica-Martinique

-100 MW,

-70 km,-US$588/kW-Highly economic

• Dominica-Guadeloupe-100 MW,

-70 km,-US$588/kW-Highly economic

Source: World Bank 2010

Nevis – St. Kitts

- Geothermal

- 50 MW,- 5 km,- US$328/kW-Highly economic

Nevis – US Virgin Islands - Geothermal - 80 MW, - 320 km, - US$ 3,540/kW - Marginally economic

Regional Initiatives cont’d

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Electricity Market IINevis - St. Kitts/Nevis-US VI/Nevis-Puerto Rico

Nevis –Puerto Rico - Geothermal

- 400 MW,- 400 km,- US$ 1,790/kW-Highly

economic

Regional Initiatives cont’d

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Electricity Market IIDominican Republic – Haiti Land Connection

• HFO steam plant 250 MW,

• 560 km, US$1,900/kW • Uneconomic unless from lower cost energy source

Regional Initiatives cont’d

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Electricity Market IVNorthern Caribbean Interconnection

Source: World Bank 2010

Regional Initiatives cont’d

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Other initiatives not considered under the

World Bank Study: Hydroelectric power

from Guyana to:

- Brazil (state of

Roraima)- Trinidad- US Virgin Islands- Puerto Rico- Dominican Republic

Hydropower orhydrocarbon tradebetween Guyana andSuriname.

Electricity Market VGuyana Hydro Interconnection/ Suriname - Guyana

Source: World Bank 2010

Source: World Bank 2010

OPPORTUNITY: Inter-connections of Electricity Infrastructure

Would require:• Interpretation of Treaty of Chaguaramas establishing

CARICOM– Also Legislative Reform to allow for importation of electricity

• Regional Regulatory Framework– At Minimum there would be need for regulatory coordination– Is the Proposed Eastern Caribbean Regulatory Authority

(ECERA) an Adequate Model?

• Large Investments: via Private Public Partnership

CHALLENGE:11. TRANSPORTATION

All vehicles are imported;

There is a large used-vehicles market

Virtually no work is being done on energy efficiency in transportation in Region.

- Jamaica introduce E-10 Bio-ethanol programme – save US$72M; increased RE in mix from 5% to 9% ; There is apparent issue of compettion with inputs rum export

- Needed: wide analysis and chacterization of transportation to quantify opportunity for EE and basis of policy

12. Lack of long term, sustained vision for sustainable energy development

• Attention to SE fluctuates with price of oil

• Climate Change Issue may change this

• Barbados SWH industry is good eg result of sustained policy for the sector

Actions: Regional Energy Policy; CARICOM Energy Programme; Caribbean Sustainable Energy Roadmap & Strategy [C-SERMS] envisions sub-regional projects;

CHALLENGE

ACTION - Regional Level• Development of a Caribbean Sustainable

Energy Roadmap and Strategy (C-SERMS); 1. RE, EE, BE Resource Assessments – ALL Countries2. Map existing efforts and identify gaps3. Set Ambitious Targets for RE & EE4. Green Electricity Sector Brand (100% RE possible in 6)5. Secure Government Commitments to targets6. Platform for engaging on-going input of all stake holders7. Strategies:

• Energy Centre – capacity building; project development; financing; R&D• Stronger link between Universities and SE Industry• To achieve targets at national levels and• Implement Regional Projects

CARIBBEAN SUSTAINABLE ENERGY ROADMAP

& STRATEGY

Sustainable Energy Platform

Regional Energy Policy

Regional Climate Change Strategy

Sect oral

Strategies:

Industrial;

Agriculture,

etc

Existing

Resource

Assessments

New Initiatives & Projects;

Financing Mechanisms

Incentives; Policy Actions

Regional Mechanism to Facilitate Projects

Implementation

Existing Initiatives &

Projects

Additional New

Assessments of

Resources

&

Energy Sector

Assessments to

Identify Gaps

CONCEPTUAL FRAMEWORK For Development of

Caribbean Sustainable Energy Roadmap & Strategy (C-SERMS)

BACKGROUNDBrief History - Energy Initiatives

• 1973-79: Trinidad and Tobago Oil Plan for CARICOM

• 1982 – Regional Energy Action Plan (USAID Project)

• 2002 – OAS – GSEII

• 2003 – Regional Task Force on Energy: Produced DraftRegional Energy Policy in 2007

• 2004 – Projects: Caribbean Renewable Energy Development Programme (CREDP): - GEF/UNDP & GTZ

• 2005 – PetroCaribe: Series of Bi-laterals; Budgetary Support (Has component for RE projects and support)

• 2005/6 –Trinidad & Tobago Energy Plan for CARICOM

• 2008 – CARICOM Energy Programme – to implement a Programmatic Approach to Energy Development in Region

Some Current Energy Projects & Initiatives in CARICOM

1. CREDP/UNDP & - ended Dec 2009 [ Finance, capacity, Awareness, Policy]

2. CREDP/GTZ /ADA Phase II includes EE [€ 5.25M + €0.75M from ADA]

3. CARICOM/EU Capacity Support € 1.5M [RE capacity support 2010-11]

4. CARICOM/UNDP – I-SEAPS – US$170K [EE and RE in public sector buildings

5. C-SEP for OECS & Bahamas – led by OAS – €1.6M [2008 – 2011]

6. CHENAT – Tourism Sector - Energy Audits

7. IDB –

1. Water Sector EE

2. SEF Barbados and Bahamas - US$2M + 50M Loan

3. C-SERMS – CARICOM Secretariat

8. Electricity Supply Option for Region – World Bank [Study]

9. ACP-EC Energy facility: Geothermal Energy Dominica

10. Energy & Climate Partnership of Americas (ECPA); Flexible frameowrk focussed on EE, RE, Access, Clean Energy Technology

Some Current Energy Projects & Initiatives in CARICOM

11. EU – Interreg III feasibility of Geothermal power production in Dominica and electricity export to French Territories

12. ACP-EC Energy Facility Geothermal Energy Dominica

13. Special Facility for Assistance (SFA)/EDF Energy Related support in SLU, SVG?

14. World Bank/OECS – ECERA

15. IDB: Barbados – Preparation of Sustainable Framework

• PV Programme, CFL, Bio fuels

16. IDB: Bahamas Sustainable Energy Framework

17. IDB: CREBAP [not yet implemented]

18. Renewable Energy & Energy Efficiency Strategy of PetroCaribe (even though, bi-lateral arrangements)

19. PALCEE by OLADE in Jamaica and Grenada

20. UNDP/Barbados – OECS Proposal for EE Awareness

21. National Programmes – Biofuels, EE,

22. Low Carbon communities of The Americas

SE Initiatives in the CARICOM

• Range of National Initiatives

– Barbados & Bahamas

– Jamaica – EE OLADE, IDB, WB, OAS

– Belize – UNDESA, OAS, IDB

– Suriname – IDB

– St Lucia – Policy support & Awareness

– St Vincent & Grenadines – EE in Govt sector

What is Being Done?• Capacity Building

– Energy Programme– CREDP (UNDP & GTZ)– CARICOM EU- Capacity Programme– IDB – Sustainable Energy Framework & Policy Based Loans– World Bank – Early stage Project Development– Cooperation with OAS, OLADE, Other Partners

• Awareness Building– CREDP;

• Video and Media• Establishment of Caribbean Information Portal on Renewable Energy (CIPORE)

www.cipore.org

– CARICOM Energy Programme - RE Awareness Building Strategy– CARICOM EU-Capacity Programme

ENERGY ACCESS

• Mammoth Challenge in Haiti

• Significant Challenge in Jamaica, Guyana, Belize, Suriname

• RE can provide some solutions – remote areas

• LPG strategy; Natural Gas should be considered; Also Diesel

CountriesPopulation (CCS Stats)

% of CARICOM Pop

Per Capita GDP (US$) -09 IMF

Percent with Access

Population with No Access

Percent of Total No Access

Antigua & Bar 87,506 0.5% 13,852 100% 0 0%

Bahamas 338,300 2.1% 21,529 99% 3,383 0.0%

Barbados 274,848 1.7% 13,003 100% 0 0.0%

Belize 322,100 2.0% 4,045 90% 32,210 0.4%

Dominica 71,612 0.4% 4,948 100% 0 0.0%

Grenada 109,724 0.7% 5,969 99% 1,097 0.0%

Guyana 766,183 4.8% 2,629 90% 76,618 1.0%

Haiti 9,300,000 57.7% 733 25% 6,975,000 94.9%

Jamaica 2,687,200 16.7% 4,390 95% 134,360 1.8%

Montserrat 4,875 0.0% 8,877 100% 0 0.0%

St. Kitts & Nvs 51,300 0.3% 10,315 95% 2,565 0.0%

St. Lucia 170,331 1.1% 5,671 100% 0 0.0%

St. Vin & Gren 100,510 0.6% 5,291 99% 1,005 0.0%

Suriname 517,052 3.2% 5,676 79% 108,581 1.5%

Trin & Tobago 1,308,600 8.1% 15,581 99% 13,086 0.2%

Total 16,110,141 54.4% 7,347,906 45.6%

Areas for Support at Regional Level

1. Wide Scale Assessment of RE Potential – Mapping + detail for high priority

2. Wide scale assessment of EE beginning with public sector

3. Public Sector EE Leadership Strategy– Green Procurement

– Demonstration EE buildings

– Support ESCo – Model of financing

• Time has potential to be fully quantified and characterized so that investment projects can proceed; Also info needs to be in hands of governments

• Huge opportunity for Governments to lead

Areas for Support at Regional Level

4. Facility of Financing Micro and Small Scale RE & EE Projects;

5. Support to Commercial Banking Sector to support RE & EE Projects in Region

– Fund; Capacity Building in Banks

6. Support for R&D in Universities – Small Equipment; Student study Pgrams & Exchanges

7. University-Industry R&D and SE Career Linkages

8. Revamping of Energy Information system –(bottom up); Re-define data capture system;

• Few requests received every month

• Comm Bank participation needed for ustainability

• Request from Universities for small support

• Timely and good quality energy info lacking for sector diagnosis, planning, performance monitoring

Areas for Support at Regional Level

7. Implementation Energy Balance and Model Framework; Re-define performance indicators

8. Sustainable Energy Agency/ Centre to provide structured support for capacity building, technical assistance to govt; project development ; R&D

• OLADE Model to be explored;

• To be proceeded by review of regional energy info infrastructure

• Proposal made under ECPA for RE Centre in T&T; Jamaica has Centre of Excellence for RE which could be regional

Areas for Support at Regional Level9. Panel of Advisors for

Backstopping support for Government

10. RE & EE Training and Certification Programme in collaboration with Universities

• Urgently needed

• Needed

Areas for Support at Regional Level11. Appliance Labelling

Strategy

– Standards; Testing & EE Labelling

– Urgent for CFLs

12. Development Building Codes & Standards & Capacity Building in Building Design and Development Sector

• OECS submitted proposal to EUEI

• Jamaica developed draft EEBC;

• Absent in rest of Caribbean

Areas for Support at Regional Level13. Need for EE

demonstration Project showcasing range of technologies

14. Support for Interconnection of electricity systems via sub-marine cable in OECS Caribbean beginning in ST Kitts and Nevis

• Project called I-SEAPS supported by UNDP has been launched; Targets CARICFOM HQ Building; Grenada; Antigua & Barbuda; Significant scope for expansion

• Idea is for St Kitts Nevis to lead and become a kind of demonstration; Dominica is next in line for development

Areas for Support at Regional Level15. Transportation Sector:

wide analysis and characterization of transportation to quantify opportunity for EE and basis of policy

16. Energy Awareness

Coordinated approach needed; CARICOM Secretariat seeking to do same with OAS, OECS, CRECS Project

• Urgently needed as transportation sector is more than 50% in many territories

• Some specific ares of support especially in Banking sector needed

Energy Access to Haiti

• Decentralized RE Options

• Transmission through DR to support selected industrial part

• Include SE priority in the re-construction process

Thank You Joseph Williams

Manager, CARICOM Energy Programme

Caribbean Community Secretariat

energy@caricom.org

jwilliams@caricom.org