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Tag: Inter-American Development Bank

SolarBuzz Jamaica > Blog Classic > Inter-American Development Bank
Alternative Energy News Solar Energy

Access Financial Approved For $30m IDB Grant To Back Green Energy Loans

July 30, 2015

Access Financial Services was approved for a US$284,000 ($33 million) grant from the Inter-American Development Bank (IDB) to finance its green microfinance -for-clean-and-efficient-energy project.

Access will also put up US$130,000 for the undertaking. The micro-lender aims to use the facility to offer financial products to micro, small and medium-sized enterprises (MSMEs) and low-income households that wish to acquire renewables or energy-saving technology.

The goal is to enable the targeted groups to achieve “better energy cost management for those MSMEs and increase disposable income of low income households”, according to project details published by the IDB on its website.

The multilateral lending agency approved the non-reimbursable technical co-operation grant last Thursday. Access CEO Marcus James was not reached for comment.

NationGrowth MicroFinance Limited beat Access to the punch. It already has a green energy loan facility available to small businesses for financing of up to $2 million and a five-year repayment period.

However, companies wishing to access this facility have to present at least two years audited financial statements, among other things. For individuals, a job letter and pay slips are taken to demonstrate ability to repay, but both business owners and householders have to put up collateral to access this loan, which NationGrowth advertises at an interest rate as low as eight per cent a year.

Still, the Development Bank of Jamaica (DBJ) appears to currently dominate the domestic market for energy financing for SMEs in terms of the range of offerings listed on the Jamaica MSME finance online directory at findmsmefinancing.com.jm.

SME OFFERINGS

The government agency offers products ranging from grant funding of up to $200,000 available to SMEs for energy audits to debt financing of up to US$3 million through a PetroCaribe funding facility.

However, SMEs are more likely to access DBJ’s regular energy loan, which provides a maximum of $30 million in financing at single-digit rates and up to seven years to repay it. The government agency is willing to fund up to 90 per cent of projects for smaller businesses, while large firms have to put up closer to a third of the project cost.

The DBJ defines SMEs as companies with less than 50 employees and annual sales of $150 million or less.

For households, the DBJ lends up to $2 million, also at single-digit rates. It lists solar water heaters, photovoltaic panels, wind turbines, biodigesters, and energy-saving lighting systems among the items for purchase that it is willing to finance.

 

 

Jamaica Gleaner

Alternative Energy Electricity Energy Saving Government News Solar Energy

Solar Energy Association Wants Info On 115MW Project

May 12, 2014

Solar panels

The Jamaica Solar Energy Association is raising concern that there has been no word lately from the Office of Utilities Regulations (OUR) about the procurement for the supply of 115 megawatts of power from renewable energy sources.

The association says it is calling for probity, transparency and urgency in relation to the renewable energy project in light of the problems currently facing the 381 megawatt project.

The OUR has already named three bidders for the supply of 78 megawatts of that power but the association says the regulator has been silent on the next steps since March.

The association is calling for the OUR to ensure due diligence is observed in relation to the 115 megawatt procurement in light of the problems now plaguing the 381 megawatt project.

The Government last week announced that it is looking to revoke the licence issued to Energy World International after it failed to post its performance bond in relation to the project.

EWI has pointed to the refusal by the Inter-American Development Bank to provide funding for the project as one of the reasons it failed to meet the bond deadline.

The IDB is reportedly withholding its support because of alleged procurement breaches in the inclusion of EWI in the bidding process which were highlighted by the Office of the Contractor General.

Now the solar energy association is demanding that the OUR exercise due diligence to determine the technical competence and financial ability of the three bidders for the 115 megawatts project to begin construction in August 2014 for commissioning by July 2016.

The association is demanding that the OUR make public the licences issued for the supply of the renewable energy generation capacity in the same way that the licence to EWI was published.

Meanwhile, the association says the OUR had committed to issuing a new request for proposals for the remaining 37 megawatts of energy for the project in early 2014, but is yet to do so.

It says it is anxiously awaiting the start of the bidding process for those 37 megawatts.

Jamaica Gleaner;

Electricity Government LNG News

Paulwell seeks legal advice on possible challenge to OCG

May 6, 2014

ENERGY Minister Phillip Paulwell

ENERGY Minister Phillip Paulwell is seeking legal advice from the solicitor general with a view to taking Contractor General Dirk Harrison to court over his report on the bidding process to implement the 381-megawatt energy project, according to a well-placed source.

Consultations, the newspaper was informed, are already underway between the solicitor general and the embattled minister, who is fighting to clear not only his name, but to repair any reputational damage that occurred to the country with the Inter-American Development Bank (IDB) reversing its position to support the 381MW project as a result of the contractor general’s report.

The Jamaica Observer was, however, unable to reach Paulwell last night for a comment.

The basis on which the minister can seek judicial review of the contractor general report lies in the legal response of the Office of Utilities Regulation (OUR) to the Office of the Contractor General’s special investigation report, the source said.

The OUR legal response, posted on its website, contends that the OCG erred in using the Government of Jamaica guidelines for consultancy tenders during its probe, whereas it should have used guidelines for Works Tenders. This, the source contends, is a serious error in law.

The OUR legal response further contends that the OUR conducted two distinctly different processes: an informal exploratory process in which expressions of interest were received, followed by a formal legal tender.

The source said that Energy World International (EWl), the company that eventually emerged as the preferred bidder to undertake the project, received Cabinet approval to be included after the deadline of the informal preliminary process but well before the commencement of the formal tender.

The sources said these two facts provided the foundation to apply for judicial review.

The project is to be built with a mix of EWI equity and multilateral funding. The imprimatur of the IDB is key to receiving the go-ahead for that funding.

It was Harrison’s first major report since assuming office in 2013. The report was issued on the same day that he issued the long-awaited Richard Azan report. But this isn’t the first time in recent years that a Government minister will be taking the OCG to court.

Transport Minister Dr Omar Davies last year sought leave for judicial review of a decision by the contractor general to monitor an oversight body set up by the minister to advise on the award of contracts to a public body.

The minister, however, withdrew the challenge.

Jamaica Observer;

Electricity Government LNG News

Bicknell Reserves Comment On EWI

May 2, 2014

 

Chris Bicknell, CEO of Tank-Weld Group.

A second effort at firing up the natural gas project seemed headed to derailment at midweek, but the candidate that would benefit from the collapse is keeping silent on its own readiness to step in.

A licence was issued to Energy World International to build a 381 MW LNG-fired plant on April 14, but the company has failed to secure backing for the project from the Inter-American Development Bank (IDB), which indicated that it viewed the procurement process that selected EWI as flawed.

EWI missed the payment window for its performance bond of US$36.85m, which was due to the Office of Utilities Regulation on April 24, but said it had made the payment on Wednesday. The company previously paid US$7.37m as a bid bond on its US$737m project. It still needs to tie down financing for the full project.

The next candidate in line to do a deal with the OUR is Energise Jamaica, a consortium led by Tank Weld Group and Musson Jamaica.

“Our Energise group has decided not to comment at this time. We want to see how the government is going to play this out. So we have decided to wait on the Government’s next move in this process.” said Tank Weld CEO Chris Bicknell on Wednesday.

HIGHER PRICE

Energise’s bid would deliver electricity to the grid at a more expensive price, US$0.1827. EWI’s project is predicated on pricing of US$0.1288. The first candidate, which failed to pay over its bond and lost out on the deal, Azurest-Cambridge, had proposed to deliver power at US$0.1390.

The OUR said last October that Energise proposes to run its plant initially on heavy fuel oil at a price of US$0.2154 for one to two years after which it expects to switch to natural gas.

Technically, Azurest’s second bid option, a heavy-fuel oil plant, also beat out Energise’s natural gas price, but it’s unclear whether the OUR is obliged to offer the American company another shot at a deal. A request for clarification was unanswered up to press time.

Energise is yet to disclose its expected sourcing of natural gas and how it will finance its project. Bicknell declined to answer those questions Wednesday as the EWI issue continued to play itself out.

Energise said previously that it has mobilised equity backers willing to put up capital in excess of US$60 million, and that its project would lead to 25 per cent savings on electricity costs.

Energy Minister Phillip Paulwell made it clear on Tuesday that he was willing to go to the mat for EWI and would seek to sway the IDB’s decision to a yes on financing for the Hong Kong-based but Australian-connected firm.

The licence issued to EWI on April 14 was amended to remove a stipulation that the Energy Minister could take over the project during the construction phase if work on the plant had stopped for more than two days, but it maintains aspects of the ‘step-in’ or takeover provisions after the plant has been commissioned. These provisions allow the minister to acquire the plant if it is idle for more than 180 days but Jamaica would have to compensate EWI 75 per cent of the estimated present value of the business, based on its current and future cash flows projected out for 15 years.

The initial compensation in the April 4 version of the licence was 50 per cent.

How the OUR first ranked the LNG bids:

Rank Bidder Bid Price Fuel Type

1 Azurest-Cambridge 13.90 US c/kWh Natural gas

2 EWI 14.56 US c/kWhNatural gas

3 Azurest-Cambridge 16.35 US c/kWh Heavy fuel oil

4 Energise 18.27 US c/kWh Natural gas

5 Optimal 18.30 US c/kWh Natural gas

6 Energise 21.54 US c/kWh Heavy fuel oil

EWI later revised its price down to 12.88 US cents/kWh.

Jamaica Gleaner;

Electricity Government LNG News

Company with Jamaican connection offers to bail out EWI

May 2, 2014

Chinese Company

A Chinese company based here has approached the Government’s investment company, Jamaica Promotions Corporation (Jampro), with a view to assist with the fallout arising from Energy World International’s (EWI‘s) failed bid to meet all the requirements to construct a booster energy plant on the island.

A usually reliable source told the Jamaica Observer that officials of the Chinese company met with executives of Jampro in New Kingston yesterday and offered to work with the island to get the project off the ground.

“During the meeting with Jampro, the Chinese suggested that they were willing to work with EWI, and vowed that they could secure the necessary financing from China’s Ex-Im Bank to get the 381-megawatt project going,” the source said.

“The Chinese have said that they were also willing to meet with the Ministry of Science, Technology, Energy, and Mining as early as tomorrow (today) to get things started,” the impeccable source said.

Hong Kong-based EWI missed its deadline to pay a performance bond of US$37 million last Thursday.

The total cost of financing the project is US$737 million, of which one per cent — US$7.37 million — had been paid over as part of the bond arrangement.

However, EWI was pushed against the wall after it emerged that the Inter-American Development Bank, upon which EWI was relying to provide non-equity financing for the project, had opted against doing so, citing breaches of Jamaica’s procurement procedures in the award of the contract.

EWI was the preferred bidder to build a power plant that would bolster the national grid by supplying it with 381 megawatts of generating capacity.

The implementation of the natural gas-fuelled project would result in Jamaicans paying less for electricity, the cost of which is prohibitive to some, and has led to widespread stealing of the commodity. Jamaicans pay 42 US cents per kilowatt hour for electricity, and it is believed that when the project is fully implemented the cost will be reduced by approximately 30 per cent.

EWI has committed to deliver electricity to the grid at 12.88 US cents per kilowatt hour.

The latest move by the Chinese company would serve as the fillip that the embattled EWI needs, following countless calls for the company to be rejected as the preferred choice of generating capacity supplier.

The Office of the Contractor General (OCG) had said in a report last year that Energy Minister Phillip Paulwell intervened improperly in the bidding process by including EWI’s proposal after the closure of the bid acceptance period.

Based on that, the OCG said that the bidding process had been compromised and described the Office of Utilities Regulation’s (OUR’s) acceptance of EWI’s proposal as unfair.

Paulwell has been under fire in recent days, with the Opposition Jamaica Labour Party calling on Prime Minister Portia Simpson Miller to relieve him of portfolio responsibility for energy over the EWI affair.

Another source said that Simpson Miller met yesterday with members of the Private Sector Organisation of Jamaica, who suggested that she abandon the entire process of selection and allow a special monitoring committee to handle affairs relating to the matter.

Simpson Miller, the source said, had already laid down some conditionalities to EWI and expects the company to respond to her by Monday.

EWI, the energy arm of Energy World Corporation, is engaged in the production and sale of power and natural gas in several countries.

The company was the second preferred bidder behind United States-based consortium Azurest-Cambridge, but was upgraded last October when Azurest was disqualified after it failed to meet a 15-day deadline to produce a one per cent security bid for the project, which it projected would cost US$690 million to build.

Jamaica Observer;

Government News Oil

Jamaica Gets Assurance From Venezuela Regarding PetroCaribe

September 10, 2013

 

Minister of Science, Technology, Energy and Mining, Phillip Paulwell, delivering the keynote address at the official opening of the Falmouth Youth Empowerment Computer Access Centre, in Trelawny, on July 25. – JIS Photo

Jamaica says it has been given an assurance by Venezuela that there would be no changes to the existing PetroCaribe agreement for the duration of its four-year programme with the International Monetary Fund (IMF).

Energy Minister Phillip Paulwell met with Venezuela officials in Haiti during the 11th meeting of the PetroCaribe Council of Ministers.

“We put to the government of Venezuela the fact we do have an IMF agreement with certain strictures, and that during the life of this agreement we have to ensure that we do not have any difficulties with other arrangements, and the life of the agreement does go through until 2017.

“So we have put to the Venezuelan government that there be no changes to the arrangement within the PetroCaribe and they have assured us as such,” Paulwell said.

Jamaica was one of the original signatories to the 2005 PetroCaribe initiative, under which Caracas provides oil and energy products to several Caribbean countries that are allowed a deferred financing mechanism, through which a percentage of the costs is made available to their governments as a long-term concessionary loan.

Last month, Caracas also gave the assurance that there would be no increase in interest rates.

In May 2013, the IMF approved Jamaica’s application for a four-year extended fund facility.

The agreement unlocked more than US$2 billion of loan support, including those from the World Bank and the Inter-American Development Bank.

Under the IMF agreement, PetroCaribe remains a critical funding arrangement for the Jamaican Government and Paulwell also disclosed that trade compensation mechanism must be fast-tracked and a major announcement would be made this week concerning a new arrangement for Jamaica to clear its PetroCaribe debts to Venezuela.

“We are also pleased that they have decided to fast-track the trade compensation mechanism that will allow us to trade our goods and services in lieu of payment of the debt in foreign currency,” said Paulwell.

“On Wednesday of this week, we have a very important announcement to make in relation to a hot commodity that will be traded,” he said.

Jamaica Gleaner;

Alternative Energy Electricity Government News

Jamaica can triple wind energy output

August 23, 2013

Students from Ascot Primary in St Catherine take in a wind turbine during a tour of the Wigton Windfarm in Manchester.

JAMAICA can triple its electricity generated from wind if it uses up its full potential.

A recent wind resource assessment identified four locations suitable for energy development with a combined potential generating capacity of 212 million kilowatt-hours (kWh) annually (just over five per cent of total consumption).

The study, which assessed 24 prospective sites across the island, revealed that Rose Hill and Top Lincoln in Manchester, Winchester at the foot of the John Crow Mountains in St Thomas, and Kemps Hill in Clarendon could each yield more than 5.3 million kWh a year.

The Winchester site in St Thomas was described as “by far the best wind site surveyed so far”, according to a Petroleum Corporation of Jamaica (PCJ) press statement released yesterday.

PCJ-owned Wigton Windfarm has already picked the Rose Hill site to place a 24 megawatt (MW) wind farm facility, for which it made a submission to the Office of Utilities Regulation’s (OUR) in response to a Request for Proposals for 115 MW of electricity generation capacity from renewable energy sources.

Wigton, which currently produces 97 million kWh from its 38.7 MW of installed capacity, projected that it could generate 63 million kWh from the new site by 2015.

And if the other three sites are developed, total wind energy production in Jamaica could surpass 320 million kWh, after taking Jamaica Public Service Company’s (JPS’s) Munro Wind Farm output into account.

What’s more, when the four addtional sites are exploited, Jamaica stands to reduce national oil consumption by at least 124,000 barrels a year, which cost above $1.2 billion annually.

The wind resource assessment was carried out as part of a wind and solar development programme, which is being implemented by Wigton under a funding agreement between the Inter-American Development Bank (IDB) and the PCJ.

“The programme aims to increase Jamaica’s utilisation of renewables by developing photovoltaic and wind power plants to supply the national grid,” said the PCJ release.

The study was based on data collected between November 2011 and January 2012.

“With our current focus on utilising our natural resources to address our energy challenges, both the government and the private sector need credible information to make development and investment decisions about viable energy solutions,” said Earl Barrett, Wigton Windfarm’s general manager.

“The national wind resource assessment will be a great resource to the majority of interests in Jamaica’s energy Sector, but we hope it will be particularly useful for potential investors.”

Jamaica Observer;

Alternative Energy Electricity News

Brimming with renewables IDB says region has enough alternative energy to fulfil 2050 electricity needs

June 20, 2013

LATIN America and the Caribbean’s renewable energy endowment is large enough to cover its projected 2050 electricity needs 22 times over, according to a new report commissioned by the Inter-American Development Bank (IDB).

The report, Rethinking our Energy Future, argues that lower prices and new technologies are making renewables a viable alternative. Solar, geothermal, wave, wind and biomass sources in this region could produce up to 80 petawatt-hour of electricity.

A solar panel is seen in this photo. Lower prices and new technologies are making solar, wind and other resources competitive with fossil fuels for power generation, according to the Inter-American Development Bank.

One petawatt-hour is equivalent to one trillion kilowatt-hour, roughly three times the amount of electricity Mexico consumes in one year. At present, Latin America generates 1.3 petawatt hour. By 2050, demand is expected to grow to between 2.5 to 3.5 petawatt- hour.

The report addresses a series of myths surrounding renewable energies, noting that several of these alternative technologies have become price competitive with conventional technologies, offer good investment opportunities and should be taken into consideration by policymakers aiming to diversify their national energy matrixes, reduce fuel supply vulnerabilities and cut greenhouse gas emissions.

“Though Latin America uses more renewable energy than any other region in the world, it faces difficult choices as it seeks to generate the electricity it needs to grow without harming the environment,” said IDB President Luis Alberto Moreno. “Renewables are becoming a viable and attractive option that needs to be explored.”

The report was presented yesterday in Bogot

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