Daraine Luton, Senior Staff Reporter
THE TARGETED reduction of the consumption of energy within the public sector last year failed to meet the announced objective, falling short by two thirds.
Energy Minister Phillip Paulwell told
Daraine Luton, Senior Staff Reporter
THE TARGETED reduction of the consumption of energy within the public sector last year failed to meet the announced objective, falling short by two thirds.
Energy Minister Phillip Paulwell told
Minister of Science, Technology, Energy and Mining, Hon. Phillip Paulwell (left), addressing the energy efficiency and conservation workshop for the Ministry and its agencies at the Jamaica Conference Centre in downtown Kingston, on March 27. Looking on is Permanent Secretary in the Ministry, Hillary Alexander.
Minister of Science, Technology, Energy and Mining, Hon. Phillip Paulwell, says individual behavioural changes are critical in the fight to conserve energy and reduce the country
GOVERNMENT is giving US$7 million (approx J$630 million) in revenues to the Russian-based aluminium producer UC Rusal, under a one-year waiver of the bauxite levy, Energy Minister Phillip Paulwell announced yesterday.
The minister, who was speaking at yesterday’s Jamaica House press briefing at the Office of the Prime Minister in Kingston, said the concession was a win-win situation for all.
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“If we didn’t do that I believe the scenario would be quite different today. We wouldn’t have the US$7 million, plus we wouldn’t have the 600 jobs or the production,” Paulwell said.
“We (Jamaica) are now going to be part of the base location for UC Rusal and we will no longer be affected by the swing of supply and demand,” Paulwell said.
He told reporters that a similar deal would have kept the Kirkvine plant in Manchester open if it was not rejected by the previous administration. “In 2010 a similar approach was made to the then government and it was not pursued and that plant is still closed today,” Paulwell said.
It was not immediately clear what proposal was put to the former Jamaica Labour Party Government by the bauxite giant and what was put on the table by the then administration.
In the meantime, Minister Paulwell said no deal has been struck with UC Rusal for its other two plants — Alpart and Kirkvine — because the Government had no sweeteners to offer. “For three years Kirkvine and Alpart have been closed, so there is no levy concession to offer as a sweetener because right now they are not paying anything,” Paulwell said.
The minister announced in Parliament Tuesday that the Government had signed a concessionary agreement to waive the bauxite levy on UC Rusal’s operation at Ewarton, St Catherine from October 1, 2012 to September 30, 2013. He said, too, that an agreement was reached for the employment level at the plant to remain at the current 600 jobs during the period of the concession.
UC Rusal, Paulwell announced, would be investing US$100 million (J$9 billion) in the facility for the construction of a coal-fired electricity-generating plant. Construction is expected to begin next year and earmarked for completion in 2015.
“We wanted a similar definitive timeline for Kirkvine and Alpart, but we are some distance away as it relates to our position and theirs, and that is why the negotiations continue and by the end of November I will report to the country,” he said. Both plants, he said, would also need to have an energy solution as this will help in the creation of more jobs.
“We are seeing with the coal plant at Ewarton, 800 jobs being created, and so if a similar approach is adopted then even before the refinery is established you can have jobs being created by virtue of the energy transformation that has to take place,” he said.
The Government, he said, has given its support to the company to pursue energy options in accordance with the country’s National Energy Policy as well as local environmental standards.
He announced that Cabinet has also authorised negotiations for the sale of the Government’s seven per cent shares in Windalco. He said these negotiations should be completed in November.
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The government has announced that energy Minister Phillip Paulwell will shortly be making a statement on his discussions with the Jamaica Public Service Company Limited (JPS).
The talks with the JPS became critical after the Supreme Court ruled recently that the licence granting the company a monopoly on the transmission and distribution of electricity was not valid.
Yesterday, the Office of the Prime Minister dismissed concern that there was a conflict within the government regarding the liberalisation of the energy sector.
Questions were raised after the head of the liquefied natural gas steering committee, Dr Carlton Davis, told a
PRIME Minister Portia Simpson Miller has reiterated her administration’s commitment to the integrated use of renewable energy to develop the economy and eradicate poverty.
The prime minister gave the assurance at last Wednesday’s opening of the joint University of Technology (UTech)/German Embassy Sustainable Energy Conference and Exposition at the institution’s Main campus in St Andrew
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“The choices we have to make are very clear. The current level of energy consumption is unsustainable,” she said, noting that the introduction of LNG as a part of a short to medium-term plan to diversify the energy supply mix is proceeding apace.
Simpson Miller told the gathering of stakeholders in the energy industry, ministry officials and members of the diplomatic corp at UTech’s Alfred Sangster auditorium that a small developing country such as Jamaica cannot expand its productive capacity, attract business and ensure the well-being of its people, with the unprecedented increases in the cost of energy annually.
“Next to debt-servicing, the cost of energy represents our greatest outflow of foreign exchange, and the outlook is for this to worsen,” she said.
She said the Government has set itself a very ambitious goal to see renewable energy sources making up 30 per cent of the national energy mix by the year 2030.
“We have embarked on a clear path for introducing and encouraging the development of the renewable energy sector,” Simpson Miller noted.
She said that she will also be closely monitoring energy consumption in the Office of the Prime Minister (OPM) under the Public Sector Energy Efficiency and Conservation Programme, which is in partnership with the Inter-American Development Bank, and is currently underway.
Under the programme, government ministries and agencies will have set targets by which they will be required to reduce their consumption. The OPM was one of the first government buildings to be retrofitted.
Germany’s Ambassador
While all eyes will be turned on Dr Peter Phillips on May 24 on how he composes the Jamaican Budget to achieve, in addition to economic growth and the protection of the vulnerable, meaningful fiscal targets that will not dissatisfy the Washington Consensus and the markets, we must not lose sight of the single most important factor which has plagued the Jamaican economy for close to 40 years: energy. As I have written and spoken about on a number of occasions, cheap oil was a significant factor in the appreciable economic growth we achieved in the 1950s and 1960s, and expensive oil has been a significant factor in our anaemic growth performance for most of the period since then. I don’t know how many people are aware that oil was so cheap that in the 1960s, we examined with Mitsubishi, and separately with Kaiser Aluminum, the building of an aluminium smelter in Jamaica. A smelter of the size contemplated required some 200 megawatts of electricity, about one-third of our current average domestic use. However, the quadrupling of oil prices in late 1973 put paid to this. Skyrocketing prices We have seen stupendous rises in oil prices, since the beginning of the latter half of the last decade with devastating consequences all round, but particularly the alumina sector, which has seen two plants closed for three years (the loss of production from which is equivalent to US$650 million in gross export earnings!) and the other two barely holding on for dear life. The rather adverse effects on the domestic home consumer and the Jamaican economy can be illustrated. The average householder uses about 170 kilowatts of electricity per month. At US$0.40 per kilowatt-hour, this is equivalent to US$68 per month, or US$816 per year. If we calculate the cost on the basis of 500,000 such consumers, this represents a spend of US$408 million annually! Were the price to be lowered to US$0.25 per kilowatt-hour, as is being touted for the new generating unit (Note that as this would represent only 60 per cent of the entire system in the first instance, the average price would be higher), this would translate into increased disposable income to consumers of about US$150 million, which would be a stimulant to the Jamaican economy in the purchase of local goods and services rather than most of it on imported oil. Important objectives In light of the foregoing, we have to strive to achieve four important objectives: 1. Replace oil with coal or natural gas, which are both cheaper now and expected to be so over the long term, for the electricity-generating and alumina sectors; 2. Get the country to conserve on its use of energy, regardless of the fuel; 3. Exploit local renewables and wastes in the production of energy to the maximum extent possible and feasible; 4. Rebalance the ratios between the use of public and private transport as a means of reducing our use of gasolene, which is far more expensive than the fuels used by the electricity and alumina sectors. I consider assisting the prime minister and her relevant portfolio ministers in achieving these objectives as perhaps the most important of my current tasks. Carlton Davis is special adviser in the Office of the Prime Minister. Email feedback to columns@gleanerjm.com http://jamaica-gleaner.com/gleaner/20120416/cleisure/cleisure3.html THE GENERAL election has been won, state power now rests with the People’s National Party (PNP), and Phillip Paulwell no longer appears to be excited about ensuring
