Tag: Inter-American Development Bank
The Inter-American Development Bank (IDB) said it would consider financing projects for waste to energy in Jamaica, but cautioned that the cost of doing so would have to be around US$0.12 per kilowatt hour for it to make sense to consumers.
“We could finance waste to energy,” but “at the end of the day, it’s going to come down to the cost. I think that’s a key component which I don’t know if it has been fully analysed,” said lead investment officer at the IDB, Stefan Wright.
He said that if solar energy was currently being produced at US$0.12/kWh,”it makes no sense financing waste-to-energy at US$0.20/kWh because JPS [Jamaica Public Service Company] won’t buy that.”
Renewable energy is a focus of the Inter-American Investment Corporation, the private-sector arm of the IDB which last year reorganised three of its four private-sector windows specifically to be more strategic, align with the IDB’s country strategy and become more effective in terms of how the Bank deploys private sector resources, Wright told a Gleaner Editors’ Forum on Tuesday.
“We are working with entities in Jamaica now to finance renewable energy projects,” said Wright, noting that Jamaica has done a good job in bringing more renewable energy on the grid and reducing the 90 per cent oil bill, “and we are very much interested in partnering with those entities who want financing”.
Referring to Jamaica’s main garbage-disposal sites, including the Riverton dump in Kingston, Wright said it would be good to be able to use those resources in a more environmentally friendly way, “but at the end of the day it must make sense for consumers”.
He also pointed to the Government’s efforts, announced by Prime Minister Andrew Holness with the formation of an enterprise team in October last year, to manage the State’s waste-to-energy programme, contracting out of solid-waste management and collection and divestment of the Riverton City landfill.
At that time, Holness was quoted as saying that the Government had received more than 30 expressions of interests to either bid on the waste-to-energy programme or to collect solid waste or both.
“We stand ready to finance projects which come out of that,” said the investment officer, noting that after the tender process is completed, entities wishing to invest in the facility would seek financing from the IDB to make the business a reality.
Key Requirements
However, he pointed out that one of the key requirements is that such entities engaging in such energy supply programmes must obtain power purchase agreements from the JPS.
“So we are certainly willing to help to participate in that,” he said. “We will finance any sustainable project which is helping to generate economic growth,” he added, noting that the IDB was offering loans between US$5 million and US$200 million per project, “and we don’t have any country limits now in terms of what we can finance”.
Wright said “we are looking at a number of projects and renewable energy and waste energy is something that we would certainly consider.”
General manager for the IDB’s Caribbean Country Department, Therese Turner-Jones, who also participated in the forum, said she has been to a series of renewable-energy conferences where private-sector interests offer various solutions, “and they look at the Caribbean as being ripe for investment because we’ve done so little”.
Comparing Jamaica with Hawaii, where the goal is 100 per cent renewables, Turner-Jones, noted that the US state is “almost there”.
“So it’s possible (for Jamaica) to do it. The technology exists,” she added.
JPS, which controls power distribution, is now reporting that renewables should account for around 12 per cent of its electricity production this year. Jamaica is aiming for a mix of 30 per cent by 2030.
A new energy-saving project costing US$30 million ($3.8 billion) will seek to reduce traffic jams in the Kingston Metropolitan Area (KMA) by synchronising 140 stop lights through a fibre-optic ring, while also cutting energy consumption at scores of government buildings.
The plan requires funding approval from donor agencies Inter-American Development Bank (IDB) and Japan International Cooperation Agency. Both are considering loans of up to US$15 million each to a project that has Petroleum Corporation of Jamaica acting as the executing agency.
The project, dubbed ‘Jamaica Energy Management and Efficiency Programme’, involves three components: it aims to fast-track Government’s National Energy Conservation and Efficiency Policy 2010-2030, target a 70 per cent reduction in energy “intensity”, and reduce greenhouse gas emissions by 10 per cent, said the IDB.
The traffic component aims to reduce the idle time that cars run on the road, which would reduce gas consumption. It would achieve this by implementing a more robust urban traffic management system – UTMS – which involves linking into the fibre-optic ring already developed by telecoms providers.
The IDB revealed the project late August and released documents on the project profile and environmental analysis. Both documents contain figures which vary slightly when breaking down each component, but the objectives remain consistent.
Regarding the road network, the government will upgrade or implement technologies for nine road segments, most of which are located in Kingston and one in Spanish Town.
39-50 Per Cent Growth
The IDB, utilising data from the National Works Agency (NWA), indicated that traffic growth along some of the KMA’s key corridors has increased 39-50 per cent over a decade, 2005-2015, without any associated improvements in road or intersection capacity.
Additionally, the absence of a complete UTMS to sync the operation of 140 traffic lights, with average spacing of 300 metres in between, remains a key factor causing congestion in the KMA.
“Most of the population commutes within urban centres, resulting in significant amount of congestion, lost time and wasted gasolene during idling or stalled traffic, especially the capital city Kingston,” stated the IDB.
Component I of the project amounts to US$24 million to finance energy efficiency and energy-conservation measures in government facilities, which could span 75 entities, with focus on educational and health facilities. Component II, at US$2.8 million, involves the financing of fuel efficiency in the transport sector. Component III, at US$1.8 million, will finance institutional strengthening for energy planning by developing information systems and training.
In 2015, public-sector facilities consumed some 7.4 per cent of all electricity generated in Jamaica, or approximately 393 gigawatt hours, costing the GOJ around US$36 million in oil imports, or an estimated US$102 million in electricity bills, the IDB said. Of this figure, roughly 22 per cent related to education and health facilities.
THE Inter-American Development Bank (IDB) has launched ‘Rise Up’, a free multimedia tool for primary and secondary schools in Latin America and the Caribbean to empower students, parents and teachers to address climate change and improve their quality of life through creative, viable and long-term solutions.
“The solution to climate change is very complex. So we created an innovative knowledge tool in a multimedia format, to address part of the problem,” said Emma Näslund-Hadley, project co-ordinator and lead specialist in the Education Division of the IDB.
Rise Up encourages teachers and students to be part of the solution. Instead of teaching science in a traditional way, Rise Up transforms learning at both school and home to harness the potential of youth and adults to mitigate and reverse climate change.
According to the World Wide Fund for Nature (WWF Spain), if we continue at this pace, the “excessive” consumption of natural resources would force humanity to have 1.6 planets to meet demand globally.
To help counter climate change, Rise Up provides instructional videos, lesson plans, video games and a green kit in English and Spanish at no cost on the initiative’s website.
Rise Up is part of the efforts of the IDB and the Inter-American Investment Corporation to combat the effects of climate change facing the region. Last year, the IDB Group announced the goal of increasing to 30 per cent the volume of loan approvals for operations related to climate change by the end of 2020.
Devon Gardner
THE CARIBBEAN is, within the next two or so years, to have an energy efficiency strategy that should serve the growth agenda of various islands.
To begin the work, the Caribbean Community (CARICOM) has secured the support of the European Union (EU).
“The EU will send a team in to work with us to identify the elements of the framework for the strategy. Having identified that framework, we will utilise a Technical Cooperation Facility (TCF) that we have with the IDB (Inter-American Development Bank) as well as support that we are already getting from the GIZ to do what I refer to as investment grade analysis to identify the energy efficiency options in the various sectors across countries in the CARICOM states,” said Dr Devon Gardner, programme manager for energy with the CARICOM secretariat.
He was speaking to the Gleaner at the energy and sustainable development forum hosted by the University of the West Indies in Kingston on Tuesday.
According to Gardner, the strategy – to be developed in line with CARICOM’s five-year strategic plan for 2015 through 2019 will take account of key productive sectors (tourism, agriculture, services and the public sector) together with the electricity and transport sectors.
MANY DELIVERABLES
In the end, he said it should deliver on:
• an energy efficient building code for the region;
• energy performance standards for certain types of appliances, including refrigerators, air conditioners, washing machines, and lights (LED and CFLs);
• energy labelling standards for appliances that provide consumers with information and operating cost of the various devices; and
• performance standards for a number of renewable energy devices, including solar water heaters.
“What are doing is not just to understand the amount of energy savings potential, but critically it is to understand the value of the energy savings to the economy and the investment package required to pursue those opportunities if we desire,” Gardner noted.
News of the regional energy efficiency strategy comes at a time when CARICOM countries are collectively using some 13,000 Btu of energy to produce one US dollar of gross domestic product (GDP) compared to 4,000 Btu of energy used by Japan, for example, to produce the same one US dollar of GDP and the global average of 10,000 Btu.
This is according to Gardner who said that “the region is perhaps the most inefficient in the world as regards energy efficiency.”
Devon Gardner
THE CARIBBEAN is, within the next two or so years, to have an energy efficiency strategy that should serve the growth agenda of various islands.
To begin the work, the Caribbean Community (CARICOM) has secured the support of the European Union (EU).
“The EU will send a team in to work with us to identify the elements of the framework for the strategy. Having identified that framework, we will utilise a Technical Cooperation Facility (TCF) that we have with the IDB (Inter-American Development Bank) as well as support that we are already getting from the GIZ to do what I refer to as investment grade analysis to identify the energy efficiency options in the various sectors across countries in the CARICOM states,” said Dr Devon Gardner, programme manager for energy with the CARICOM secretariat.
He was speaking to the Gleaner at the energy and sustainable development forum hosted by the University of the West Indies in Kingston on Tuesday.
According to Gardner, the strategy – to be developed in line with CARICOM’s five-year strategic plan for 2015 through 2019 will take account of key productive sectors (tourism, agriculture, services and the public sector) together with the electricity and transport sectors.
MANY DELIVERABLES
In the end, he said it should deliver on:
• an energy efficient building code for the region;
• energy performance standards for certain types of appliances, including refrigerators, air conditioners, washing machines, and lights (LED and CFLs);
• energy labelling standards for appliances that provide consumers with information and operating cost of the various devices; and
• performance standards for a number of renewable energy devices, including solar water heaters.
“What are doing is not just to understand the amount of energy savings potential, but critically it is to understand the value of the energy savings to the economy and the investment package required to pursue those opportunities if we desire,” Gardner noted.
News of the regional energy efficiency strategy comes at a time when CARICOM countries are collectively using some 13,000 Btu of energy to produce one US dollar of gross domestic product (GDP) compared to 4,000 Btu of energy used by Japan, for example, to produce the same one US dollar of GDP and the global average of 10,000 Btu.
This is according to Gardner who said that “the region is perhaps the most inefficient in the world as regards energy efficiency.”
The Jamaica Public Service Company (JPS) says it is unable to definitively state how the use of both automotive diesel oil and liquefied natural gas (LNG) at the Bogue power plant in St James will impact the price of electricity to consumers.
It said the power plant currently burns on automotive diesel oil “and we are doing a conversion that adds the capability to also burn natural gas. So we will end up with the ability to burn both fuels at no extra cost”.
Responding to Wednesday Business queries about the rationale for the dual-fuel facility, the JPS said natural gas will be the primary fuel on which the plant operates and automotive diesel oil will be a back-up fuel “in case we have any problems with receiving natural gas”.
It added that under normal conditions, the plant will effectively be a gas-fired power plant.
IMPACTON ELECTRICITY PRICES
As to how it will impact the price of electricity the JPS said in emailed responses that “we cannot speak to the likely impact on electricity prices given the uncertainty of prices in the future (for oil vs LNG)”.
However, it said that the impact is expected to be negligible given that Bogue only represents approximately 10 per cent of the company’s total costs.
“What we can say with fairly good certainty is that the cost of electricity today is 30 per cent lower than it was one year ago, and we expect that trend to continue throughout 2016, given that 80 per cent of our net generation (production) will still be based on oil, 10 per cent will be from natural gas, and we expect renewables to make up 10 per cent of our net generation once the three renewable energy projects currently under construction (for circa 80 megwatts) are completed before the end of 2016.”
The JPS, an integrated electric utility company and the sole distributor of electricity in Jamaica, added that “that means we continue doing a good job as a country of increasing the penetration of renewable, while also diversifying our fuel mix and reducing our overexposure to oil”.
It said that it is hoping to continue doing more of that through the 37 megawatts of renewables currently being pursued by the Office of Utilities Regulation through a request for proposal, as well as its 190 megawatt gas-fired power plant that will be commissioned in mid-2018.
IMPROVING COMPETITIVENESS
Reducing the cost of electricity is critical to improve competitiveness, according to the International Monetary Fund’s latest updated memorandum of economic and financial policies.
It said that the action plan prepared by the Electricity Sector Enterprise Team foresees replacing current oil-fired generation capacity with gas, coal and ethane-fired plants to achieve significant cost savings.
Next steps will include the conversion of the Bogue power station from oil to gas, a process which the JPS is currently undertaking.
In addition, said the memorandum, the Government has approved the construction of Jamaica’s first natural gas-fired power plant, a 190-megawatt facility to be built and operated by JPS, and to be completed by 2018. Several renewable energy projects are also under way.
The Government said it will prepare a plan to ensure that all public entities – central government, local government and public bodies – meet their financial obligations in a timely manner.
In the memorandum, the Government also pointed out that urgent actions will be taken to reduce the time needed for entrepreneurs to get an electricity connection. Plans foresee the automation of the work processes within the government electrical regulator and the acquisition of an Application Management and Data Automation (AMANDA) software to streamline procedures for scheduling, inspecting, approving and certifying electrical installations.
An action plan for implementation of the reforms and adoption of the AMANDA system are expected to be completed in fiscal year 2016/17, with support from the Inter-American Development Bank.
WASHINGTON, United States (CMC) — Jamaica is the only Caribbean Community (CARICOM) country that will benefit from an Inter-American Development Bank (IDB) multimillion-dollar-funded regional Energy Efficiency Green Bond Facility.
The IDB said that it has approved financing to establish the facility and that the programme was selected to receive up to US$217 million in additional funding as one of eight projects worldwide in the first round of allocations announced by the Green Climate Fund (GCF) earlier this month.
“This private sector programme stands out for its innovative financial approach, involving small and medium enterprises and the potential mobilisation through capital markets of funds from different institutional investors such as pension funds and insurance companies,” said Gema Sacristan, IDB’s Financial Markets Division Chief.
Providing an alternative financing mechanism for energy efficiency projects through the issuance of green asset-backed securities (ABS), the programme will also contribute to the development of capital markets in the region.
The programme will introduce green ABS following the Green Bond Principles standards and will foster socially and environmentally responsible investments.
“The approval of this programme furthers our commitment to supporting Latin American and Caribbean countries in the implementation of their proposed Intended Nationally Determined Contributions (INDCs),” said Amal-Lee Amin, IDB’s Climate Change and Sustainability Division Chief.
“Tapping into domestic capital markets for refinancing of energy efficiency is key for increasing the scale of investment for de-carbonisation over the medium and longer-term.”
IDB said that Mexico will be the first country to implement this programme, followed by the Dominican Republic, Jamaica, and Colombia.
The IDB’s loan of up to US$400 million will be complemented by a loan of up to US$50 million from the China Co-Financing Fund, administered by the IDB, in connection with the first utilisation of the facility in Mexico.
EXTREME weather events associated with climate change have cost the country in excess of $128 billion in damage over the decade between 2002 and 2012.
Minister of Land, Water, Environment and Climate Change Robert Pickersgill made the startling revelation at the launch of the Adaptation Programme and Financing Mechanism at the Four Seasons Hotel in New Kingston recently.
“This covers a range of damage ranging from social dislocation and loss of property and lives, to which a dollar value could not be affixed,” said Pickersgill.
The adaptation programme, which falls under the Pilot Programme for Climate Resilience (PPCR), and which is funded by the InterAmerican Development Bank (IDB) to the tune of US$7.8 million under the global Climate Investment Funds (CIF), will increase the country’s resilience to climate change by enhancing the island’s adaptive capacity across priority sectors.
He said it was common knowledge that Jamaica is among the most vulnerable nations to the impacts of climate change. He noted, however, that with the relevant training, policies and national education, the phenomenon which threatens hotter temperatures, rising sea levels, longer, drier droughts and more extreme weather events, will become less of a challenge. The goal, Pickersgill said, is a Jamiaca that is climate change resilient and focused on its sustainability.
“We envision a future that is climate resilient; one where economic development and environmental sustainability are parallel outcomes, and one in which every Jamaican man, woman and child can enjoy the benefits of this,” the minister said.
“What the PPCR will provide, therefore, is an opportunity to build our capacity, and to look beyond weather and hydrological information to a focus on climate information for decision-making,” he continued.
The technical co-operation project valued at over US$19 million will include the mainstreaming of climate change adaptation in local sectorial and national plans.
IDB Country Reperesentative Therese Turner-Jones said Jamaica could access up to US$10 million as the facility allows for a concessional loan-financing window.
“The three-component programme will include mainstreaming climate change into development planning, supporting climate change resiliency efforts in the upper Rio Minho watershed area, and implementing innovative climate financing, particularly in the agribusiness and tourism sectors across island for SMES [small and medium-sized enterprises]. The lessons learned from these adaptation interventions will be disseminated throughout the island,” Turner-Jones said at the launch.
The Planning Institute of Jamaica (PIOJ), which is the national implementing organisation, reiterated the government’s pleasure that the island was selected among six Caribbean regional PPCR and pilot countries.
Deputy Director General Claire Bernard said the pilot programme could fulfil outcome 14 of Vision 2030, which speaks to effecting strategic objectives to addressing issues of climate change, adaptation and disaster risk production.
In terms of integrating climate change as a subject and policy objective across all ministries of government, minister Pickersgill pointed out that training for policy-makers and climate change focal points across all ministries has already begun.
Jamaica is to benefit from a US$20-million pilot climate-change adaptation programme to be funded mainly by the Inter-American Development Bank (IDB), which will be implemented by the Ministry of Land, Water, Environment and Climate Change, working with selected, allied state agencies and non-government organisations.
The overall objective is to increase Jamaica’s resilience to climate change, by enhancing the country’s adaptive capacity across the priority sectors of water, health, tourism, coastal resources and human settlement. It will be financed by a loan of US$10 million, at interest rate of 0.025 per cent per annum, and a grant of US$7.89 million from the Climate Investment Fund through the IDB, with counterpart financing of US$1.97 million from the Jamaican Government.
Increasing Awareness
Therese Turner-Jones, the IDB’s country representative for Jamaica, used yesterday’s official launch to emphasise the need for getting everyone up to speed about the harsh reality of climate change and the need for such interventions.
“Increasing the awareness of citizens – every child, every young person in Jamaica about how serious this is because I don’t think the problem is going away,” she told the audience at the Hotel Four Seasons in St Andrew.
“It’s really important that everybody understands that this is a problem that’s going to be with the world for a very long time. So the earlier we can educate our children about it, climate change and also the negative impacts and what we can do as a country, things will be better off years from now.”
Turner-Jones explained that the IDB does many pilot projects in Jamaica, which are then replicated in the region, and with its next five-year country plan for Jamaica now in the making, climate change will be a crosscutting theme in many of the development projects regarding water, sanitation and agriculture.
Meanwhile, Claire Bernard, deputy director, sustainable development, at the Private Sector Organisation of Jamaica (PSOJ) appealed to stakeholders to treat the project with the urgency and priority it deserves.
“I share the experience of working with a number of agencies which seem to treat funded projects as an appendage whose needs are addressed when there is a slack in the normal work. The result of this is that projects are perennially underspending and behind schedule. The intended benefits are delayed or compromised, effectiveness is impaired, cost increases, and there are implications for the national budget.”
The senior PIOJ executive went on to stress the importance of getting the project implemented on time and within the original budget.
“Being a pilot beneficiary in this facility puts Jamaica under the microscope with respect to our performance and consistency …, the extent to which we scale up good practices, the innovativeness of our activities and capacity for others to learn from them but most importantly, the sustainability of the intervention.”
THE Inter-American Development Bank (IDB) and University of Technology (UTech) recently collaborated on a one-day workshop designed to teach non-technical professionals about the energy sector and how it affects their lives and businesses.
Billed ‘Demystifying the Energy Industry’, the event targeted business people, entrepreneurs, banking and insurance executives, among others. It zeroed in such areas as energy costs and renewable alternatives to fossil fuels.
IDB Country Representative Therese Turner-Jones noted that “because energy is a complex and technical topic, discussions are often dominated by energy sector professionals”.
But the workshop, she said, would help non-technical professionals “navigate discussions involving issues like petroleum-derived fuel products, natural gas, wind, solar, waste-to-energy, biofuels and energy efficiency”.
Dr Ruth Potopsingh, associate vice-president of Sustainable Energy at UTech noted that “knowledge of the energy sector can better equip us all to make sound business decisions”.
IDB Consultant Dr Earl Green presented the results of the IDB/DBJ Energy Efficiency Pilot Projects for Small & Medium Enterprises and a video called Success Stories in Energy Efficiency in Jamaica.
Lumas Kendrick Jr, senior energy specialist, IDB, moderated a panel discussion on Finding Solutions for Jamaica’s Energy Sector Challenges, which included panellists Fitzroy Vidal, director of energy, Ministry of Science, Technology, Energy & Mining; Christopher Brown, business development manager, Development Bank of Jamaica; Dr Ruth Potopsingh, associate vice-president-Sustainable Energy, UTech; and IDB/DBJ Grant recipients Yorkin Waltes, owner, Triple Seven Farms and Pauline Wilson, general manager, Pioneer Meats.
