A map of Jamaica
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THE POPULAR concept is that coal is a dirty fuel, especially with regard to particulates, sulphur and carbon-dioxide emissions. With natural gas, the level of particulates would be lower than with coal, but in the latter instance, the particulate emissions with modern coal-burning boilers equipped with effective particulate-removal equipment would be substantially lower than are currently being experienced with the oil-burning boilers.

Sulphur emissions with either fuel will be dependent on the source of the fuel. Low-sulphur coal (less than one per cent by weight) is available relatively close to Jamaica, for example, Colombia and Venezuela.

However, even at the current relatively high sulphur emissions, complaints from persons in the areas adjacent to the power stations are rare.

Bruce Golding
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Government departments and institutions accounted for up to $11 billion, or approximately $880 million monthly, in electricity costs last year – nearly 15 per cent of the total amount of electricity consumed annually in Jamaica.

Prime Minister Bruce Golding and Energy and Mining Minister James Robertson, who disclosed this information during a workshop staged last Thursday at the Knutsford Court Hotel in New Kingston, cited government agencies and departments, as well as public schools and hospitals, among the primary consumers.

Oil accounts for nearly 40 per cent of the country’s total import bill.

Golding said Jamaica, which has one of the world’s highest energy-intensive ratings, was also one of the most inefficient users of electricity.

“We use 20,000 BTUs (British thermal units) to produce one US dollar of output of value. The global average is less than quarter of that.

“We waste energy, and Jamaica’s economic future cannot be secured unless we address this problem in a fundamental way,” the prime minister lamented.

Golding said the Government, through the energy and mining ministry, had developed four significant platforms – the national energy, national renewable energy, national energy from waste as well as the energy conservation and efficiency policies – to address the issue.

However, the prime minister acknowledged that Jamaica experienced several challenges to fulfilling some objectives in the national energy policy, which called for increasing the mix of renewable energy sources.

“Right now, we’re somewhere near five per cent, and the policy requires we get up to 10 per cent by 2015 and 20 per cent by 2030. That’s ambitious and particularly challenging,” Golding admitted.

He said the challenges were even more pronounced when analysis examined Scandinavian countries, which were environmentally conscious and advanced in their use of renewable energy sources, albeit paying more for it.

“Renewable energy is not always cheaper energy, but they are prepared to pay more in order to get energy that is clean, green and sustainable. Our consumers can’t be asked to bear that burden, and that’s part of our problem,” Golding said.

Conservation important

The prime minister added that while any search for alternative energy sources also had to be cheaper – in order for them to be viable – conservation was important to sustainable energy management.

Golding accused Jamaicans of being price-insensitive when it came to energy conservation, citing motorists’ refusal to change fuel-consumption patterns during 2008 when oil prices rose as high as US$148 per barrel.

The Government’s 10 per cent GCT charge on the electricity bills of persons consuming more than 200 kilowatt-hours monthly in order to make up revenue shortfall had little effect on consumption patterns.

“The information I have from the JPS (Jamaica Public Service Company – the monopoly electricity provider) is that they haven’t even blinked. They pay the 10 per cent and consume the same amount of electricity,” said Golding.

Jamaica Gleaner

A vintage ampere meter.
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The Jamaica Public Service (JPS) in its own inimitable way has sent yet another ‘shock wave’ to consumers when it announces that, among others, it will now be adding general consumption tax to reconnection charges. Never mind that the disconnection might have resulted in the first place from their actions – i.e., either the high cost to use their service or massive overbilling.

Electricity supply, like water, is a basic utility without which the quality of life for all individuals will be adversely affected. So, who will speak up against the action of the JPS?

Our first line of defence, the minister of mining and energy, is preoccupied with his personal well-being, and the next line of defence, the Office of Utilities Regulation (OUR), like many of us, are ‘shocked’ into silence. We dare not take to the streets as the residents of Seaview Gardens found out recently. So what are we to do? We need to examine carefully the role and functions of the OUR.

The OUR was established by an act of Parliament in 1995 to regulate the operations of utilities companies. According to the official website of the OUR, its role as an independent regulator is often misunderstood, particularly by its largest stakeholder group, consumers, who are of the general belief that it seems to side with the utilities providers.

The OUR’s mandate is not that of a consumer advocacy group and, as such, will only intervene in grievances if the affected utility consumer writes to them after getting no satisfaction from the utility company who, in their opinion, did them a disservice. If the overbilling by the JPS is not classified as grievances then what is? This overbilling for which many consumers are unable to pay will now have GCT added for the sure disconnection that will follow. All this while the OUR sits and do nothing when, in fact, it can. Even though it does not see itself as consumer advocacy group, it has a number of divisions, such as the Consumer and Public Affairs.

Advisory group

This division deals with consumer affairs, communication and information. It is in this division that the works of an independent advisory group is facilitated. The name of this group is Consumer Advisory Committee on Utilities. If the OUR wants to intervene on behalf of its consumers/stakeholders, then it can do so directly or indirectly, or however it thinks fit. Not to do so will only make consumers question their relevance in face of this frontal assault on our pockets by the JPS.

And I must admit that the JPS, over the years, has lost a lot of revenue through electricity theft, but we must not forget that a percentage of that ‘lost revenue’ was recovered from us legitimate customers on the approval of no less than the OUR, which now stands impotent.

I am, etc.,

HOWARD D. HAMILTON

Jamaica Gleaner

Illustration: Different types of renewable energy.
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THE Development Bank of Jamaica (DBJ) has dismissed reports that there have been no takers for the loans for renewable energy projects for the micro, small and medium-sized enterprise (MSME) sector.

However, it has admitted that clients have experienced challenges in taking up the loans, which are disbursed through approved financial institutions (AFI), such as commercial banks, merchant banks, credit unions and micro finance institutions and the National People’s Co-operative Bank.

Some $84 million in loans has been disbursed with another $40 million approved to eight clients under the programme since 2008, general manager of the DBJ’s AFI relationship division, Yvonne Lewars disclosed on November 10.

“There has been take up of the funds, but not as fast as we would like,” Lewars told Environment Watch.

The DBJ’s managing director Milverton Reynolds, stating that renewable energy was of “strategic importance” to the organisation, said the DBJ recently negotiated a grant of US$591,000 or approximately $51 million from the Inter-American Development Bank (IDB) dedicated to energy usage.

The grant would be used for three things, namely:

* to implement a study to determine the demand for energy in Jamaica;

* to support the training and certification of energy auditors in partnership with the University of Technology; and

* to launch a public education programme about the importance of renewable energy.

Describing the cost of energy as “too onerous and burdensome” for businesses in Jamaica, Reynolds said this ought not to be a huge problem because the island has “endless sunshine and wind”.

He was speaking at the opening of the Scientific Research Council’s 23rd science and technology conference and exposition at the Jamaica Pegasus Hotel in Kingston on November 9.

However, responding to complaints that the loan approval process was too complex, Lewars explained that before an alternative energy loan is disbursed, an energy audit must be carried out. This involves assessing the energy usage of an entity or business and determining how much can be saved by making adjustments, such as changing bulbs, properly sealing windows, and improved ventilation to areas, even before a loan for alternative energy is disbursed.

Lewars said in an effort to improve the approval process, the DBJ had developed models for various sectors in order to reduce the need for MSMEs to pay for audits. Models had been done for poultry businesses and manufacturing, among other sectors.

“It’s a very specialist area. We are training our staff on the various alternative energy sources that can be used, but before we use alternatives, what can we do with the existing business to reduce cost? For example, a simple water heater in a hairdressing business can greatly reduce the energy supply chain,” she said.

In the meantime, the DBJ said it was developing better relationships with AFIs and meeting with business persons to make the applications more acceptable.

Former energy minister Clive Mullings has been among persons calling for the DBJ to disburse alternative energy loans itself, instead of wholesaling them though AFIs.

The loans provide up to $15 million or 90 per cent financing to clients at 9.75 per cent interest.

Read more: http://www.jamaicaobserver.com/environment/DBJ-approves–124M-in-renewable-energy-loans_8141068#ixzz16zRYromo

Don Wehby, Guest Writer

Bill Clinton last week reinvigorated the public discourse on the use of renewable energy in Jamaica. Solar energy, of which Jamaica is in abundant supply, is particularly important if we are to diversify away from imported sources of energy and become energy self-sufficient.

While much has been said about solar electricity over the past few years, actual usage has been slow to spread because of the large initial investment required and the scarce availability of financial incentives.

It currently costs somewhere between J$2 million to J$3 million to fully equip a three-bedroom house with solar-generated power. This puts solar systems out of the reach of the majo-rity of Jamaican homeowners.

4kW Aerial Shot
4kW job in Kingston. Jamaica

Although the upfront expenditure is burdensome, solar panels have a lifespan of 25 years or more and a minimum battery life of seven years. They are built to withstand 125-mile-per-hour winds and will start losing power after about three days of overcast conditions.

The payback period for solar investments is typically 6-8 years and can be sooner, depending on rising fuel costs, taxes on electricity (currently 10 per cent GCT in Jamaica) and foreign-exchange movements.

Despite these benefits, there are few incentives to invest in solar technology in Jamaica.

Currently, solar systems – including panels, batteries and inverters – are exempt from GCT and import duties.

The National Housing Trust (NHT) also offers low-interest “solar panel loans” of up to J$1.5 million for individual applicants and J$3 million for co-applicants. The interest rate ranges from 1 per cent to 7 per cent, depending on your weekly income, with a repayment period of 15 years.

The NHT also offers a solar water heater loan of up to J$250,000 at 3 per cent for 5 years. These loan options should be more aggressively marketed so that more Jamaicans are aware of their existence.

On the commercial side, the National Export-Import Bank of Jamaica has implemented a special credit line for manufacturers and agro-processors to establish alternative- energy systems at relatively low interest rates.

While these incentives are commendable, they are not enough to fuel a solar energy revolution in Jamaica. In fact, Barbados is the leader in the Caribbean in terms of structuring incentives to drive renewable energy adoption.

Homeowners receive significant income tax deductions for investing in systems and equipment that make their homes more energy-efficient and/or generate electricity from renewable sources.

Along similar lines, I recommend that the following provisions be added to Jamaica’s income tax code to encourage solar energy adoption among both commercial and residential property owners:

An individual owner of residential property who spends, inter alia, on energy saving or water-saving devices be entitled to a maximum deduction from yearly taxable income of up to J$1,000,000.

Up to J$250,000 can be deducted for expenditure related to a home energy audit and the purchase of any conservation materials or systems recommended in that audit. A home energy audit is defined as an evaluation by an authorised energy auditor of the energy consumption in a household to determine ways in which energy can be conserved.

Up to J$750,000 can be deducted for expenditure on the purchase or installation of ‘environmentally preferred products’. ‘Environmentally preferred products’ means pro-ducts that cause significantly less harm to human health or to the environment than alternative pro-ducts that serve the same purpose; or products, the consumption of which contributes significantly to the preservation of the environment.

A tax policy for commercial enterprises should also be implemented based on the following guidelines:

Up to 30 per cent of the capital cost of investing in renewable energy technologies can be deducted from profit before tax, with a maximum claim of J$20 million; and

Accelerated depreciation on qualifying environmentally preferred assets – for example, depreciation of up to 50 per cent of the asset in one year.

These tax incentives will drive adoption of solar technology at both the residential and commercial levels, helping to move Jamaica towards becoming self-sufficient in energy.

NET METERING HAS A ROLE

Finally, we need to reach a consensus with the domestic power company on the issue of net metering.

Net metering allows an electricity customer’s meter to run backwards if the electricity he or she generates is greater than that consumed, effectively banking the electricity until it is needed by the customer.

This provides the customer with full retail value for all the electricity produced and is used in more than 30 states in the US and widely throughout Europe.

Under Jamaica’s proposed net billing policy, an additional meter will have to be installed at the customer’s expense, and a much lower ‘avoided cost’ value is placed on surplus electricity despite it being generated in a more environmentally sustainable way. This is a financial disincentive.

Net metering will make the payback period on deploying solar technology shorter and is a matter of priority if we are truly serious about energy self-sufficiency.

At approximately J$25 per kWh of electricity, Jamaica’s energy costs are among the most expensive in the world – with adverse effects on our standard of living and productive capacity.

Let us use the reinvigorated public discussion to effect real change in how we incentivise renewable energy use.

Don Wehby is group COO of GraceKennedy Limited.

don.wehby@gkco.com

Jamaica Gleaner

Bombay high
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The Office of Utilities Regulations (OUR) contends that Jamaica will not only miss out on savings on fuel imports by switching to natural gas, but would have to spend over US$2.4 billion more to build new plants over the next 20 years if it wants to continue as “business-as-usual”.

In its Generation Expansion Plan drafted in August, the OUR examined three main expansion strategies

Electricity Pylon, crossing lines
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The Office of Utilities Regulation (OUR) has invited bids from twenty-eight local and international companies, including the Jamaica Public Service Company Limited (JPS), to supply 480 megawatts of new generating capacity.

This is the largest block of generating capacity ever sought by the OUR and it’s intended to: allow for the displacement of old and inefficient generating plants; provide for growth in demand and improve the efficiency of the overall electricity generation system.

The installation of the new generating capacity is scheduled to be carried out in two phases. The first 360 megawatts is scheduled to be installed by 2014 while the remaining 120 megawatts is to be installed by 2016.

The Request for Proposals (RFPs) seeks to achieve the goals of ensuring that Jamaica improves its energy efficiency in generation, contribute to fuel diversification which will impact energy security and most importantly, positively impact the affordability of electricity. The request coincides with the initiative taken by the Government to introduce natural gas as the fuel of choice for electricity generation and for the mining sector as outlined in the 2009 – 2030 National Energy Policy.

The RFP was issued on September 30, 2010 and bids are to be submitted no later than January 7, 2011 in keeping with the schedule outlined in the bid document.

Jamaica Observer

This Jamaica Gleaner letter to the editor is in response to Lisa Hanna’s letter in which she says Jamaica should look into clean coal and admits clean coal is harmful to environment.

Kindly permit me the privilege of commenting on Ms Lisa Hanna’s letter on the subject of ‘clean coal’ as an energy source for Jamaica.

Ms Hanna, I beg to disagree with you.

No well-informed individual will disagree that coal-fired energy plants are more reliable and cost-effective as an energy source than natural gas. However, the subject of coal energy, per se, is quite complicated. One should be properly apprised of all facets on the subject in order to make a positive viable assessment on the issue.

First, there is a vast technical difference between, ‘clean coal’, and ‘truly clean coal’. Traditional clean coal technology applies to a process that adduces the extraction of certain impure substances from the coal, thus opening the way for the existing carbon and oxygen to react when the coal is burned and subsequent to burning, the ash residue is then filtered out along with some pollutants, such as nitrogen oxide from the emissions. This process only reduces the nuisance of the environmental pollutants causing acid rain and smog.

When the coal mining industry classifies coal as emission-free coal (clean coal), they are referring to the removal of the public nuisance pollutants, and not to the elimination of the greenhouse emissions which causes climate change as specified in the accords in the International Standards agreements, such as the Kyoto Protocol, which puts the onus on mining companies to produce truly refined carbon-free coal, or ‘carbon zero emissions coal’.

Grave political concern

Neither the United States nor China, the two largest producers and consumers of coal, has ratified the Kyoto Protocol agreement, for reasons related to the sensitive political implications on their economies. Partly out of genuine concern and partly in response to strong environmentalist lobbying, the US has given a time frame to their coal industry to comply with the standards of the accord. The US uses 50 per cent and China 80 per cent coal for their total power-based generation.

In order to meet the criteria of the International Accord for truly clean coal, the coal-mining companies would be giving an edge to the other competing energy sources, because of the resulting high cost to be incurred by consumers, if and when the transition is made. This prognosis is foreseen to premise to the possibility of coal being either reduced in importance, or being phased out of the energy market, and in the process creating serious dislocations in the large coal mining labour force. And this is an issue of grave political concern.

A further downside is the fact that established accessible coal reserves world-wide, at the current rate of consumption, will be depleted in just over 200 years, which period will definitely be lowered should China pursue its plans to export a significant portion of its coal production. This single fact makes it imprudent, or less than feasible, to make an investment in coal for energy purposes at this time.

Alternative energy solar-oriented institutions, such as Suntech and Kyocera, solar power, wind energy entities, such as Suzion, Siemens and General Electric; natural gas firms, such as British Petroleum, Chevron and Anadarko, Hydroelectric energy engineering and Hydrogen research entities, are aggressively posturing their environmentally friendly status; and may eventually succeed in removing coal from being the major energy source – a position it has maintained since the industrial revolution.

The use of coal energy necessitates storage stockpiling, which is done by creating open storage facilities, or by the construction of special silos; both methods present a range of hazardous challenges, including spontaneous combustion, carbon monoxide and other undesirable gas emissions, dust nuisance, respiratory health issues, etc. All of which require the use of expensive equipment to contain, supported by constant monitoring.

The cost of transporting natural gas is prohibitive. To convey it by sea requires the condensing of the gas to a liquid form (LNG) before it is encapsulated in cryptogenic tanks, fitted in special vessels prepared for that purpose. Over land it requires special pipe lines to convey it to high pressure storage tanks. The major challenge here is illegal siphoning and sabotage either at the wharf or along the pipe run.

Russia has the largest proven reserves of natural gas while Qatar has the largest gas field. Pockets of natural gas are being discovered on a regular basis in several regions of the world. It is also available from sources such as bogs, swamps, and shale, as well as in oil wells, and coal mines; which reasons makes it extremely difficult to arrive at any accurate data as the duration of the availability of natural gas from established reliable sources. At the current rate of consumption, natural gas is expected to last 150 years.

Although natural gas is being touted by the industry as being the fuel of the 21st century, scientists have warned of the imprudence of taking such a pronouncement seriously, as only approximately three per cent of natural gas is being used in the world’s total power generation at this time; and should this rise, the available natural gas would be seriously depleted. Advanced plans are in place to replace the use of fossil energy generation with alternative renewable sources by the year 2030. At present, however, there is no available substitute for aviation fuel, which must await the perfection of hydrogen fuel technology; the energy fuel of the future.

The most viable suggestions for Jamaica at this time is to engage the use of a combination of hydroelectric and wind-powered energy generation, coupled with using solar power for street lighting, investing in an autoclaving facility, which converts the waste disposal available from our garbage dump sites, and sewage-disposal systems to fuel.

Explore autoclaving

In the United Kingdom, just such a facility is being constructed at an estimated cost of US$70 million, which is destined to be the largest of its kind in the world. This technology not only provides an efficient solution to the waste disposal problems, it converts waste to energy. All waste goes into the system, without any need for any form of separation into various categories. The possibility of building such a plant in Jamaica with the support of interested Caribbean Community partners, should be fully explored.

Autoclaving provides:

  1. (a) Biofuel – second generation bioethanol, biodiesel and biobutanol.
  2. (b) Biofuel to be co-fired in conventional, and biomass power stations.
  3. (c) Biofuel for conversion to biogas using anaerobic digestion technology to produce fuel for industrial boilers, and motor vehicles as well as household gas, etc.

(d) Independence from imported fuels reduced to 80 per cent of the sum currently expended to purchase fossil fuels, as well as giving a competitive edge to exporters. Lowering the cost of public transportation and energy used for industrial and domestic consumption, etc.

(e) An investment of a sum less than two-thirds of the proposed cost of the United Kingdom’s plant could supply our energy needs and recouped the sum invested in a relatively short time.

I am, etc.,

HUGH WILLIAMS

psytech616@yahoo.com

Kingston 8

Jamaica Gleaner

A solar panel used at the Ecological farm near...
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Allow me space in your publication to respond to a letter in which Member of Parliament Lisa Hanna defends her thesis on ‘clean coal‘ as a possible energy source on which to build our economic future.

I’m quite in agreement on the points made in her first two paragraphs, but must violently disagree on her postulation about Jamaica’s economic future being built on cheap energy source, and that source being clean coal. Her view about the stability of coal price is myopic.

May I remind her about our cheap bauxite in the 1970s, how it became expensive when we thought that all and sundry were benefiting – except us, the primary producer. All commodities are subject to market manipulation, politically or otherwise.

Here is my solution for building our economy, by marrying two renewable resources, our people and renewable energy, we will create a symbiosis which has perpetuity. Consider the vehicle you love, the great value lies in the head of those who manufactured it, so will the solution to solve our energy needs. For it is the value that is added to any resource that gives value, by developing our human resource to harness the abundant energy which bathe our beloved island daily we will have a dependable source of energy, and can even be net exporters of energy-harvesting equipment.

No good foundation

MP Hanna points to the competitiveness of economies having cheaper energy source, but here are the calculations. For solar energy, the most expensive at present price using a life of about 40 years, the cost is US 13 cents per kilowatt-hour and set to go down as the industry matures.

She said coal-based power supplies 40 per cent of the world’s electricity and this is set to go up with China’s ever increasing wealth and its desire to improve the lot of its citizens. Coal, whether clean or not, is set to see greater demand and, hence, price movement. That’s not a good foundation on which to base a country’s future, when we have a source of energy that is in our hands, for a better way to build one’s future.

Global warming

We are all concerned about the global state of the world environment; research indicates that global warming is due, in part, to the use of fossil fuel. A shift to renewable energy will lead to a reduction of our carbon footprint. Over time, this could be brought near to zero.

This approach will render the development of resources in the constituency she now represents feasible, but further arguments can be made about the country as a whole. The natural scientists, business persons, civil engineers, manufacturers, artisans and even casual labourers will be beneficiaries of this policy approach. This is development.

In the final paragraphs of the letter, the issue of liquefied natural gas (LNG) was discussed. Again, as with her discussion on coal, the decision to embrace LNG as the fuel of choice is wrong. Proponents of both fuel miss the key issue. It is the human resource that should be at the centre of policy.

Both sets of proponents see the Jamaican people as objects to be exploited while a bone is thrown their way. I can show a policy path that can lead us into wealth, creativity and, finally, a proud people which have the capacity to solve our problems. My friends say there is a dinosaurian tendency among the young politicians, by association, and they are about to redo the failure of the last 48 years. We can point them the way to a better future.

I am, etc.,

AUBREY MURRAY

Atlantic Solar Corporation

10 Chisholm Avenue

Kingston 10

Jamaiaca Gleaner

see Lisa Hanna article below

Coal can supply north coast with power, says Hanna

Member of Parliament (MP) for South East St Ann, Lisa Hanna, is suggesting that, using the clean coal technology to safeguard the environment, a coal power plant located in St Ann could generate enough power to satisfy demands on Jamaica’s north coast.

“Right now Jamaica is producing energy at US$0.30 per kilowatt hour whereas countries which are competitive are producing at five cents,” Hanna told The Gleaner. “And you are not going to have persons running to do business in Jamaica if the energy costs are eating up their profit, which is also what is happening.”

The St Ann MP said she wanted efforts to be made to export limestone and bring in coal.

“If you look at a constituency like South East St Ann or South West St Ann, if you put a clean coal power plant up there you can power the entire north coast with it,” she argued. “That is something that I would like to realise.”

Hanna argued that the Government’s pursuit of liquefied natural gas (LNG) as a solution to Jamaica’s energy problems would be an expensive venture when compared to using coal.

Energy and Mining Minister James Robertson has stated that Government’s LNG project was expected to save Jamaica US$1.2 billion in energy cost.

Expensive venture

However, according to Hanna, the cost would still be high as Jamaica would have to import the LNG.

“That is going to be an expensive venture and clean coal technology is technology that is being used in different places of the world quite successfully,” Hanna said. “And there are places that have the coal and need limestone and the ships could export (limestone) and import the coal at the same time.”

In the United States, the cost of a megawatt of electricity produced by coal runs between $20 and $30, while a megawatt of energy produced from natural gas ranges between $45 and $60.

Hanna’s comments reflect a concern expressed by Jamaicans who over the years have been calling for alternate sources of energy in order to reduce Jamaica’s dependency on oil. Solar, wind and hydropower sources have been suggested as viable alternatives.

Loan programme

The National Housing Trust (NHT) has taken a step in this direction by introducing a loan programme to assist home owners install solar powered water heaters in their homes.

Research shows that approximately 40 per cent of the world’s energy was derived from oil, while 23 per cent was derived from coal.

Experts estimate that, by 2025, 80 per cent of the world’s oil reserves would have been used. Coal reserves, on the contrary, are capable of lasting 1,000 years.

One drawback of the use of coal however, is that its negative impact on the environment is greater than oil and natural gas