“In about three years you are going to see degradation in the generating capacity and units are going to start to fail
Arthur Hall, Senior News Editor
After a decade of expensive flirting and the expenditure of some US$4 million, the Government has finally ended its attempt at introducing liquefied natural gas (LNG) as the solution to the country’s high electricity prices.
Energy Minister Phillip Paulwell last week blamed the unavailability of the supply of LNG at reasonable prices as the reason for the reversal of a decision which had found favour with successive administrations over the past decade.
“Last year, in the middle of all that we were doing, I went to Angola to try to find gas. I recently went to Nigeria. I have been trying to find gas that makes sense,” Paulwell told a Gleaner Editors’ Forum as he noted that the original source for the gas, Trinidad and Tobago, has now officially been abandoned.
“2010 with Exmar would have been the best time to pursue an LNG deal. At that time, the market situation was right, Exmar had a number of projects going so they could benefit from the volume.
“Since then, the price of LNG has gone up, largely due to the demand out of Asia,” said Paulwell as he noted that the price of LNG has more than doubled since the Exmar agreement was abandoned.
According to Paulwell, he always favoured coal over LNG and had made a recommendation to that effect to the Cabinet shortly before the People’s National Party was voted out of power in 2006.
Mullings favoured coal
Clive Mullings, who replaced Paulwell as energy minister in the Jamaica Labour Party administration, also favoured coal and is believed to have lost his place in the Bruce Golding-led Cabinet because he bucked his colleagues who agreed that LNG was the way forward.
With Paulwell now done with LNG, coal will be in the fuel mix but gas remains highly favoured as the main alternative source of energy for the Jamaica Public Service Company (JPS).
“I am not going CLG (compressed liquid gas) and I’m not going LNG,” Paulwell told the Gleaner editors even as he refused to say exactly what would be the option.
Instead, the energy minister said major discussions are slated for tomorrow which could determine how quickly Jamaican consumers will get cheaper electricity.
He said officials of the JPS, the major players in the bauxite industry, the Government and an international investor are to meet in Kingston in an attempt to iron out an agreement.
“If that agreement is reached, the natural gas project is on,” said Paulwell as he refused to provide any further details on what he described as sensitive negotiations which have been taking place over the last two months.
Close to recommendation
Paulwell declared that after all the discussions and negotiations which took place last year, he is close to being in a position to recommend a firm position to the Cabinet.
He said if there is no agreement out of tomorrow’s meeting, his backup plan will include the introduction of interim solutions of small generation facilities, including renewables while moving towards the introduction of coal.
“Coal won’t come for about four years, even though the Chinese have said they could bring it in two years,” said Paulwell who is adamant that the price of electricity to the Jamaican consumer must move to between 15 and 18 US cents per kilowatt-hour (c/kWh) instead of the present 40-41 US c/kWh
Paulwell had previously announced that the JPS would be introducing LNG at its soon-to-be constructed 360-megawatt plant in Old Harbour, St Catherine.
“The Government of Jamaica decided it was no longer going to be the procurer for gas and it put the ball back in the court of the company that received the licence but it did not mean we would be sitting ideally by, so we have been very engaged in the process,” said Paulwell.
While admitting that it will not be his call if the JPS accepts the gas project now on the table, Paulwell said he would be urging the parties to find common ground when they meet tomorrow as this could lead to lower electricity prices at the earliest time.
Energy Minister Phillip Paulwell is staking his political career on cutting the cost of electricity to Jamaicans by more than 50 per cent.
Last week, during a Gleaner forum, Paulwell listed the steps he plans to take to ensure that electricity from the Jamaica Public Service Company (JPS) becomes much cheaper over the next three to four years.
1. Fuel diversification
Plan:
THE Government is implementing a street light energy saving initiative, with the commencement of a pilot project, to be undertaken in three parishes over the next six months.
The initiative, being jointly implemented by the Ministry of Local Government and Community Development, and the United States-based technology and engineering solutions firm, Green Energy RG LLC, is aimed at significantly reducing the cost to the budget to maintain the country’s approximately 93,000 street lights, which totals upwards of $2 billion per annum.
The Government has begun its pilot programme of introducing energy efficient street lights.
The programme, which kicked off on Tuesday, will see some $5,000 solar panels being installed in sections of Clarendon, Kingston, St. Andrew, and St. Catherine.
The initiative is aimed at reducing the government
Local Government and Community Development Minister, Noel Arscott (right), and President, Green Energy RG Caribbean Limited, Jonathan Burke, examine the features of a solar light emitting diode (LED) panel.
The Government is implementing a street light energy saving initiative, with the commencement of a pilot project, to be undertaken in three parishes over the next six months.
The initiative, being jointly implemented by the Ministry of Local Government and Community Development, and United States-based technology and engineering solutions firm, Green Energy RG LLC, is aimed at significantly reducing the cost to the budget to maintain the country
WE are aware that many factors can affect negotiations between the Government and business entities wishing to set operations here.
Those factors can range from complex to the most minute detail. Either way, they most times lead to start-up delays that frustrate all parties involved.
With that in mind, we hope that the Government and Russian firm UC Rusal, owners of Alpart, can sign off on a reopening date for the alumina plant as quickly as possible. Ideally, we wouldn’t mind if that agreement could be reached before the middle of this month, as was projected by an official of the mining and energy ministry and reported in last week’s edition of the Jamaica Observer Central.
According to the ministry official, “the discussions are continuing and they are very productive, but they are at a delicate stage”.
The mid-January date offered by the official followed on a promise by Mining and Energy Minister Phillip Paulwell, in November, for word on the plant’s reopening by the end of last year.
That word cannot come too soon for the people of St Elizabeth, particularly those in the south-eastern section of the parish. In fact, the entire Jamaica, we believe, will welcome the reopening of Alpart, so too the Kirkvine plant
The ill-health of Venezuela’s president
A perfect example of the shortage of vision affecting Caricom governments is their dropping of the ball on the Leucaena project in the early 1980s. Ambassador Byron Blake, former Caricom assistant secretary general, reminded us of that last month during a sitting of the Jamaica Observer Monday Exchange. For those who missed it, the Leucaena project was established in response to the energy crisis of the late 1970s. Essentially a group of scientists and energy experts from Jamaica, Barbados, Haiti, Trinidad & Tobago, and St Lucia started producing energy as well as animal feed from the Leucaena plant, which is referred to in some parts of the world as the ‘miracle tree’ and in Jamaica as the ‘wild tamarind’. The initiative received support from colleague scientists in the region as well as from Caribbean governments and several international donor organisations. At the height of the project, companies such as Enerplan Limited Oil prices rose Monday as political leaders were trying to finalise a deal to avert the ‘fiscal cliff’ hours before the deadline. The US had until midnight New Year’s Eve to avert a tax increase for everyone and spending cuts that would have hit defence spending. Benchmark US crude rose US$1.02 to finish at US$91.82 per barrel in New York. Oil has wavered in recent weeks along with the ups and downs of the budget negotiations. The price of oil finished December up about three per cent from the start of the month. It ranged from a low near US$77 a barrel to high around US$110 a barrel during the year. Brent crude, used to price international varieties of oil, rose 49 cents to end at US$111.11 a barrel in London. In other energy futures trading on the New York Mercantile Exchange: natural gas fell 12 cents, or 3.4 percent, to finish at US$3.35 per 1,000 cubic feet; wholesale gasolene rose one cent to US$2.81 a gallon; heating oil was flat at US$3.05 a gallon. Read more:
