Industry News

Renewable Energy Needs Stronger Support from Government

Caribbean states have promised to reduce their dependence on fossil fuels and transition to a more renewable energy economy. Saint Lucia and Aruba has even gone so far as to vowed to transition to 100% renewable energy generation as part of the Ten Island Challenge. Yet these commitments, as important as they are, have not produced regulatory reform to match these lofty promises. The Caribbean Development Bank is working to update legislation to support emerging renewable energy projects across the Caribbean region. The RE market needs policy support from governments if it is to secure funding.

Shockingly, very few countries currently have energy policy and legislation in place allowing households and businesses to generate their own power through alternative technologies. This leads to a policy gap that acts as a barrier to wider investment.

The most notable exception is Jamaica whose electricity grid allows for independent power produces (IPPS). In many countries such as Bermuda and Grenada, there is a monopoly for electricity generation where a single privately-owned company controls the entire vertical electricity market. Out-dated cost benefit analysis hinders renewable energy installations, especially small-scale household solar, which are seen to be more expensive than wholesale diesel-based electricity. This leaves no demand or economic incentive to develop new technologies for these utility monopolies.

In Barbados, the popular locally designed and manufactured solar water heaters were subsidized by the government. There have also been hugely successful wind farms in Jamaica, backed again by the Government. However, other projects struggle to get off the ground due to lack of regulatory reform and land leaseholds. In Bermuda, years of negotiations have failed to produce fair payment arrangements between domestic solar PV projects and the Bermuda Electric Light Company (BELCO).

Promising research by Rebekah Shirley and Daniel Kammen, University of Berkeley, demonstrates that there are many scenarios in which renewable energy technologies already provide significant job creation and carbon reduction benefits, and most importantly, are competitive with current electricity costs.

This is supported by the Caribbean Development Bank and the Inter-American Development Bank, but there is still a long way to go to translate into changes in national regulation, local investment opportunities and reduced barriers to grid integration. As noted by Thomas Scheutzlich, Principal Advisor for the Caribbean Renewable Energy Development Programme, the absence of large renewable energy projects in the region can be attributed to the absence of regulations requiring utility companies to back implementation. The potential for green jobs is strong and could prove to be a powerful incentive for national regulatory reform. It will be interesting to see what develops over the coming years.

Advertisements

13 replies »

  1. An impressive share! I have just forwarded this onto a co-worker who has been doing a little research on this.
    And he in fact ordered me breakfast because I stumbled upon it for
    him… lol. So allow me to reword this…. Thank YOU for the meal!!
    But yeah, thanx for spending some time to talk
    about this topic here on your blog.

    Like

    • Bon appétit!

      Thank you for the kind words. We plan to do a much larger feature on this very topic including a bit more cross-country comparison. Please feel free to share any related work from yourself or your colleague. Always great to hear what others are working on.

      Like

  2. Pingback: URL
  3. I’ve been browsing on-line more than three hours today,
    but I by no means discovered any interesting article like yours.
    It is pretty worth sufficient for me. In my opinion, if all site owners and
    bloggers made excellent content as you did, the internet
    might be much more helpful than ever before.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s