This article has been submitted by the JPS.
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As the Office of Utilities Regulation (OUR) evaluates proposals for the construction of the next generation of generating plants, the question of what is the best technology to deploy has ignited a public debate, as we saw with the recent article published in the Business Observer (Wednesday, April 3).
The two leading technologies that have emerged are the medium-speed reciprocating engines (diesel) (MSD) and the combined cycle gas turbines (CCGT). Both technologies are currently in operation in Jamaica and have some inherent advantages and disadvantages.
Total generation cost, flexibility of fuel options, ease and frequency of maintenance and environmental issues are all important considerations that will factor into the decision by the OUR in the technology choice. The analysis by JPS has concluded that the CCGT is the right generation solution for Jamaica at this time.
Policy & regulatory framework
The decision on the most appropriate technology for electricity generation is first framed by the policy objectives of both the Government and the OUR. The two most important objectives of the National Energy Policy and the regulator are:
1. A significant reduction in electricity prices; and
2. Fuel diversification.
The Government and the OUR have agreed that a policy of diversifying the mix of fuel used for electricity generation away from oil is the most effective in lowering electricity cost. JPS agrees with this policy approach and it is within that context it has conducted an evaluation of the available technologies to replace its existing capacity and prepare for sustainability and future growth in electricity demand.
Sector experience
JPS has been Jamaica’s electricity provider for 90 years and owns the largest block of power plants on the island. Its majority shareholders, Marubeni Corporation of Japan and Korea East-West Power Company together own and operate power plants (including diesels and combined cycle units) with an installed capacity of over 9,000 MW globally and using a full range of fuels: coal, gas, oil, hydro, wind, solar. No other entity in Jamaica and few others across the world can similarly claim this level of operational familiarity and experience with such a range of plants and fuel.
JPS drew on this knowledge, experience and policy objectives in preparing its proposal to the OUR and after careful analysis has concluded that the CCGT technology offers the best efficiency and flexibility option for generation expansion in Jamaica at this time.
Here’s why.
Cost of Energy