The changing energy landscape of the Caribbean

Report
Green Growth Investment Forum
Brussels, Belgium
October 6-7, 2011
THE CHANGING ENERGY LANDSCAPE
OF THE CARIBBEAN:
INVESTMENT OPPORTUNITIES IN AN
EMERGING GREEN ECONOMY
by Tricia Williamson, Technical Information Officer,
Caribbean Energy Information System,
Scientific Research Council
CONTENTS
Overview of the Caribbean’s energy resources
 The “Before” Situation & Barriers to RE
 Initiatives Implemented to Address BarriersMarket Share and Focus
 Caribbean’s Expectation from Past Investments
 Green Investment Initiatives in the Region
 The Impact of Green Investments
 Challenges Investors Still Face
 Caribbean’s Expectation from Future
Investments
 Target Areas for Investment

THE CARIBBEAN HAS A HUGE RESOURCE
OF NATURAL SOURCES OF ENERGY
All states- of
note is
Barbados,
Grenada
Solar
thermal is
utilized in
all
countries,
particularly
for the
tourism
sector
Most states
in
particular:
Grenada,
Cuba,
Guyana,
Jamaica,
Suriname
Most states,
including
Dominica,
St. Vincent
& the
Grenadines
Guyana
Cuba
Jamaica
Suriname
Some states,
including
St. Kitts &
Nevis,
St. Lucia,
Dominica,
St. Vincent
&
Grenadines,
Montserrat
All states
have the
capacity- of
note are St.
Kitts &
Nevis (first
wind farm
in OECS),
Cuba,
Jamaica.
BARRIERS TO RENEWABLE ENERGY &
GREEN TECHNOLOGY
Awareness/
Information
Capacity
Policy
Finance
Barriers
to RE
KEY INITIATIVES IMPLEMENTED TO
ADDRESS BARRIERS
There have been many initiatives in the region, a few key regional
projects have included:








Caribbean Renewable Energy Development Programme
(CREDP)
Caribbean Hotel Energy Efficiency Action Programme
(CHENACT)
Preparation of a Geothermal-based Cross-Border Electrical
Interconnection in the Caribbean
Caribbean Sustainable Energy Program (CSEP)
Bioenergy in the Caribbean: Supporting Policy Dialogue on
Sustainable Energy Services for SIDS through South South
Cooperation
Building Low-Carbon Communities in the Caribbean Project
Capacity Building of Caribbean Private Sector Environmental
and Energy Management Capabilities' Project
Petrocaribe (not including Barbados and Trinidad & Tobago)countries like Jamaica have used funds to support RE & EE
projects
MARKET SHARE OF INITIATIVES IN
CARIBBEAN STATES
Caribbean Energy Information System
Types of Interventions by Country (2000-2009)
60
50
Energy Cons/ Efficiency
Petroleum
40
Renewable Energy
Others
30
20
10
0
Countries
AREAS OF FOCUS FOR INITIATIVES IN THE
REGION’S ENERGY LANDSCAPE
WHAT WAS THE CARIBBEAN'S EXPECTATION
FROM THESE INVESTMENTS?
With billions of dollars of investment and
hundreds of projects and initiatives- the
Caribbean expected to reap significant benefits
once the barriers to RE were removed,
including:
1. Improved energy and economic security associated
with the diversification of the energy mix
2. Reduction in the importation of petroleum
products
3. Improvement in the balance of trade
4. Transfer of technology/ equipment
5. Building of local expertise in renewable energy
technologies.
6. Policy development
PETROLEUM CHALLENGES
105
105,000.0
95,000.0
95
85
85,000.0
75
75,000.0
65
65,000.0
55
55,000.0
45
45,000.0
35
35,000.0
25
25,000.0
Increase in the
importation of
petroleum
products
15,000.0
15
1999
2009
Caribbean Energy Information System
Caribbean Electricity Installed Capacity 1999 to 2009
(16 Countries)
12,000.0
12
10
10,000.0
8
8,000.0
(ooo's MW)
REPORTING UNIT: (Millions Bbls)
Caribbean Energy Information System
Caribbean Total Petroleum Consumption 1999 vs 2009
(16 Countries)
6
6,000.0
4,000.0
4
2,000.0
2
-
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
PETROLEUM IMPORTS STILL A CHALLENGE
With respect to petroleum imports, an assessment
revealed that although less than 30 million barrels
of imports of petroleum were avoided, challenges
still remain.
Identified causes:
 increases in population
 increases in economic activity
 rapidly increasing use of technology (computers,
telephones etc.)
 improvement in the standard of living of most
countries
 the global economic recession
 increased importation of vehicles
 rebuilding efforts from natural disasters.
GREEN INVESTMENT INITIATIVES IN THE
CARIBBEAN
With respect to the financing of energy initiatives,
some eighty-eight (88) agencies have served as financial
sources and over US$2.5 billion in green investments
made.
For Example:
USD 10 million line of credit to support SMEs and
renewable energy in Dominica (2010)
 Targeting the private sector-renewable energy and energy
efficiency projects will benefit from a dedicated USD 1.3
million component and will further benefit from an interest
rate subsidy to facilitate investment in these sectors.
In June 2011 Energy and Climate Partnership of the
Americas (ECPA) announced approved proposals
from Antigua and Barbuda, Dominica, Grenada,
Jamaica, and St. Vincent and the Grenadines that
will involve projects that include using solar panels to heat
water and wind turbines to power irrigations systems.

THE IMPACT OF GREEN INVESTMENT
INITIATIVES
Several areas were noted as having positive impacts from the
various initiatives within the countries studied. These are
as follows:
 Increased capacity development
 Social programmes
 Savings
 Job creation
 Transfer of equipment/technology
 Development of policy/plans/regulations
 Improved quality of life
 Increased access to information
 Increased awareness
 Development of new markets
 Shift in behavioural change
 Income generation.
WHAT CHALLENGES INVESTORS
FACE?
•
•
•
•
•
STILL
Access to funding issues including need for low
interest rates; banks reserved in financing RE/EE
projects due to lack of knowledge, experience &
confidence. High debt burden of benefiting country
(dept-to-GDP ratio) makes Government guarantees
difficult
Longstanding monopolies of utilities- IPPs still feel
hampered and Electricity Acts need revision.
Policy issues: Absence of regulatory oversight bodies
and standards in some countries; Long period
between moving policies from draft to enactment.
Changes in government and policy direction.
Inadequate infrastructure in most countries; land
ownership issues
Sustainability through training and skills
development.
WHAT IS THE CARIBBEAN
LOOKING FOR FROM POTENTIAL
INVESTMENTS?
One main area that has been expressed:
Proposed initiatives should be
matched against the development
goals of the country/region and
utilize local capacity to ensure the
initiative will create the necessary
impact and ensure sustainability.
OPPORTUNITIES FOR INVESTMENT
A few areas to consider:
Expansion of investments into bio-fuels,
hydropower, wind farms, geothermal and
photovoltaic systems.
Solar energy equipment for the health canters
and hotel sector; particular focus on rural areas
Energy efficiency in the public sector
Energy projects targeting the transportation
sector.
Energy projects with environmental protection
strategies to mitigate the effects of climate change.
THE
CARIBBEAN IS OPEN FOR BUSINESS

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