This is nothing new as the article below even points out that ‘Lewars said the decision to pursue the initiative primarily arose from the “sluggish” response to the energy fund by targeted stake-holders since 2008.’
Yes folks there have been millions of dollars avail for energy to all Jamaican businesses since 2008. Then why has no one taken the loans causing it to be sluggish? When I met with DBJ a few months ago inquiring about this mysterious ‘energy loan’ the facts were these. Yes the loan is available and at that time they had just reduced the interest rate to 9.75% so that’s not news. The problem was, and I am sure still is since there was no mention of it in this not news article, that the term for the loan is max four years (or something ridiculous like that). Which makes the monthly payment for the loans extremely high plus the interest rate at 9.75 is still too high.
If they are serious about energy loans in Jamaica we need a loan term of 10-15yrs. This will make the monthly loan payment less than what a business is paying to JPS monthly. Now I understand its risky to lend businesses for more than five years but there are some very strong Jamaican companies who have been around for decades who are strong enough to qualify for an extended term limit.
Honestly, I went to them gym this morning at 5am before work so I am tired just like this energy loan argument. Making millions of dollars available is not enough as they have been doing that since 2008, allegedly. Corporate energy loans need extended term limits and if possible better interest rates to make the monthly loan payments less than what businesses pay a month to JPS. Until then the money will sit there gathering interest for who knows who to do who knows what with while the DBJ keeps being baffled as to why no wants to pay 5 times for a loan on a monthly basis than what they are paying JPS monthly. Even if it is for only 4 years. Every other green energy country figured this out in 2008 yet its now 2011 and we are trying to teach an old dog new tricks.
I am not a rocket scientist. I am Jrob… See Gleaner article below.
The Development Bank of Jamaica (DBJ) has embarked on a three-pronged initiative to promote its small and medium-sized enterprises (SME) energy-loan facility, which is financed by the PetroCaribe Fund.
The initiative, to be undertaken over a 24-month period, will include a market study to determine demand for renewable energy projects; strengthening of the technical expertise to support project development and implementation by targeted sector interests; and a public-education campaign, to showcase energy efficient, energy conservation and renewable energy projects already implemented.
Yvonne Lewars, general manager of DBJ’s Approved Financial Institutions Relationships (AFI) Division, said the initiative will be jointly financed by the Inter-American Development Bank (IDB) and the DBJ. She said the project would cost US$807,000, or approximately J$68.6 million.
Lewars said the decision to pursue the initiative primarily arose from the “sluggish” response to the energy fund by targeted stake-holders since 2008. These include commercial and industrial entities, energy-service companies and manufacturers of energy-efficiency equipment and devices.
Over $500 million, provided by the PetroCaribe Fund, has been committed by the DBJ to finance the development and implementation of energy efficiency, energy conservation and renewable energy projects.
The funds are on-lent to sub-borrowers, primarily business entities interested in pursuing such projects, through AFIs affiliated with the DBJ, at an interest rate of 9.5 per cent per annum.
AFIs include commercial banks, merchant banks, the National People’s Co-operative Bank, the EXIM Bank and microfinance institutions.
Lewars says $68 million was set aside for project development in the manufacturing, agro-processing and services sectors, and the balance of approximately $432 million earmarked for SMEs and tourism interests. A maximum of $15 million per entity is provided for SME projects which, on average, equates to some 90 per cent of the DBJ’s funding input to borrowers.
We have all be watching the government’s LNG plan crumble faster than the Jamaican roads but today’s news regarding Promigas is significant. Promigas is who the government named as the savior of Jamaica’s energy problems by making them the preferred bidder for an LNG project here. But AEI the parent electricity company of Jamaica Private Power is selling its majority stake in Promigas “to reorganise the company around a smaller business focused on power generation.” Hmmm, sounds like they have figured out that the US$1billion it will take to even get Jamaica on the LNG track might be a risky idea. Or maybe ‘smaller business focused on power generation’ means its going with the rest of the world and looking ways to produce cheap green energy through solar etc. Really all that has happened is that thankfully the details of this entire racket have come to light and for once hopefully the Jamaican people will not be sold out for a cash grab.
Anyway the most recent 3 strikes for LNG are below but as we know there are many more. Its Wednesday so I will see you at the Jamaica Contender tonight taking my mind off the price of oil (pssst $100 a barrel and Jamaica uses an energy mix of of over 90% diesel fuel. Fuel comes from oile but don’t tell anyone cuz government keeping that science a secret).
Strike 1 – Government is yet to receive commitments from potential off-takers of LNG, including JPS and the island’s alumina refineries that they will use the fuel. (fast ball)
Strike 2 – Removal of the LNG project from the control of energy minister, James Robertson, transferring it to Office of the Prime Minister under Zacca’s guidance. (breaking ball into Robertson’s nuts)
Strike 3 –