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

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

Saying the issue was as fundamental as their survival, a group of micro and small businesses has collected close to 1,000 signatures on a petition handed to Prime Minister (PM) Bruce Golding pleading for support of the sector.

The MSME Alliance’s list of concerns runs the gamut of the expensive cost of doing business, and how to mitigate impact on companies’ bottom line.

Its list was mostly skewed towards access to credit and taming energy overheads, including a proposal to implement an energy subsidy financed from dividend payments to the Government on its one-fifth equity stake in the Jamaica Public Service Company (JPS).

The proposal goes even further to suggest that Jamaica “assume ownership of transmission lines”, which are currently the property of the JPS. The utility is owned 40 per cent by Marubeni of Japan, 40 per cent by Taqa of the United Arab Emirates, 19.9 per cent by the Government of Jamaica through the accountant general and the Development Bank of Jamaica, while 0.1 per cent is held by individuals.

But the group is also seeking more duty concessions, the establishment of an agency that can sell “collateral cover” to micro, small and medium-sized enterprises (MSMEs), and a more palatable credit policy that makes it easier for them to access investment capital.

The alliance – whose membership covers 35 business associations that represent some 300,000 businesses – staged a mock funeral for businesses in the MSME sector in August, which it dubbed ‘Bawl Out’, to bring public attention to the concerns.

list of concerns

From that event, and subsequent feedback from businesses, it has put together a 10-point list of concerns, which the group has asked Golding to give some consideration to before returning to the public-private sector Partnership for Transformation Talks.

They met with the PM on September 2, according to a release from the group.

“These signatures represent only a small fraction of the support we have received since our Bawl Out in Portmore Pines,” said Anthony Charley, first vice-president of the MSME Alliance.

“Our members are fighting for survival and we will continue to bawl out until we feel the support from the Government.”

The 10-point list, including sub-points – dubbed by the alliance as a large-scale national risk-management programme for MSMEs