Dr Horace Chang says if given the green light from the utilities regulators, the National Water Commission (NWC) could generate even more power than the Jamaica Public Service (JPS).
Chang, who has responsibility for water in the Ministry of Economic Growth and Job Creation, said that currently the NWC’s biggest expense is its electricity bill, which averages around $450 million monthly.
“Of course, if the water supply company is allowed to generate its own power without any kind of guidance or regulation, we could end up producing more power than JPS. If we have hydropower, we can produce so much; we have lands we can produce solar power and not only remove ourselves from the grid in terms of supply sources,” Dr Chang argued.
He was addressing the final day of the three-day 14th Annual Conference of the Organisation of Utility Regulators last Friday, held at Secrets Resort and Spa in Montego Bay, St James.
He called on the utility regulators to examine the relationship between utilities.
“Can exception be made [in] how you do it and in what way it is done that it doesn’t end up superseding the other? That’s maybe the biggest question,” Dr Chang said. “Regulators have to create the framework in which the company itself can move forward; the broader policy of ownership is decided by the Government.”
The water minister explained that under the current arrangement, if the NWC or the National Irrigation Commission were to “produce power for itself and reuse it”, they would have to first be awarded a licence by the Office of Utilities Regulations.
“Under the current regulator, if you produce power, move it from one venue to the next, you need a licence. And if you are doing a licence, it has to be competitively awarded and that creates challenges,” he argued.
“Certainly, I think we can produce power on site, which we intend to do in a couple of our local outlets, but that raises some challenges.”
Another challenge he highlighted was wheeling, which refers to the scheduling of the energy transfer from one balancing authority to another. Since the wheeling of electric energy requires use of a transmission system, there is often an associated fee which goes to the transmission owners.
“The challenge here is not only wheeling for commercial purposes [and] home users, but since a water company can produce water in large amounts, the question of wheeling within the head of the utility becomes relevant. It is something that needs to be addressed,” Dr Chang said.
“The real impact of water is, it also has a social impact, but it has to be produced at an economical rate. And power becomes one of the big cost factors. For irrigation, in fact, we might not be able to provide our southern plain — which is our major provider of food supply — with irrigated water if we don’t have the right to produce some of the power for ourselves, because farmers cannot afford to pay the JPS bills.”
