The Red Stripe Jamaica brewery at Spanish Town Road, Kingston. – File
Deputy director general of the OUR, Hopeton Heron (right), responds to a question at the 115MW project meeting hosted by the Office of Utilities Regulation, on Thursday, January 17, 2013, at The Jamaica Pegasus hotel in New Kingston. OUR’s manager of utility monitoring and generation procurement, Peter Johnson, is at left.
Steven Jackson, Business Reporter
This article was originally published online on Friday, January 18, 2013.
Prospective investors complained about parking millions of US dollars as a security deposit via the government regulator Office of Utilities Regulation (OUR) for bidding on 115 megawatts (MW) of clean energy projects.
They also want safeguards against monopoly distributor Jamaica Public Service Company effectively underbidding them in applying for these projects – as it already controls the grid.
JPS is one of 85 entities which submitted expressions of interest for the 115-megawatt renewable projects. Proposals must be submitted by April.
The OUR noted the financial concerns while indicating that investors can use it as a JPS intermediary.
Over 200 prospective investors – one-quarter foreigners – attended an OUR meeting at The Knutsford Court Hotel in Kingston Thursday. The turnout “pleasantly surprised” OUR representatives.
It indicated the financial interest in renewable energy that forms part of the Government’s 2030 vision to reduce the island’s costly dependence on fossil fuels.
But one participant, general manager Wigton Wind Farm, Earl Barrett, complained of an additional financial burden requiring developers to put up at least 20 per cent of the financing of the project, which obviates full financing by banks.
Responding to the concerns, Peter Johnson, OUR manager of utility monitoring and generating procurement, said: “We want some commitment from the developers themselves. We do not want them to be just a conduit. That is the idea. We want some commitment from the developer.”
“It is not unreasonable,” added Courtney Francis, senior regulator of engineering at the OUR.
Leo Williams, seeking to represent bidders, said inter-connection with JPS would pose another hurdle in seeking financing for projects.
JPS can charge a higher fee to rivals to connect to the grid and a lower charge to itself, said Williams and other participants.
“The question of JPS and the level playing is one of which I hope you have heard. The concern expressed relates to the inter-connection costs to the (bidders) which are totally uncapped from the JPS side. So JPS could indicate all types of requirements which could drive the inter-connection costs up for the (bidder),” said Williams, who then asked in vain for the regulator to provide some indicative empirical costings.
“That would be rather difficult. We cannot give a per-unit cost because it depends on the technology, configuration, depends on where you are accessing the system from, the size, and a whole raft of things. It’s hard to quantify such costs,” Francis responded.
Industry players negotiate interconnection based on a minimum rate set by the OUR.
Renowned lawyer Frank Phipps queried the fairness of the inter-connection arrangement and whether in previous bids, rivals won over JPS bids.
“There have been previous applications where the JPS won and others in which others have won,” stated Johnson, who later added: “Please be reminded that there are already other independent power providers on the system and interconnection was a part of those arrangements. We have not seen or heard of concerns by those persons. So we are not aware of a foundation for these concerns at this time,” said Johnson.
Finally, Johnson sought to allay fears: “If you have difficulty dealing with the operator (JPS), we recommend that you submit queries to us.”
Two Petroleum Corporation of Jamaica representatives asked why not allocate a maximum slot for JPS to bid and offer the remainder to other players.
“We do not want suboptimal solutions. So we do not want to set aside anything without knowing it will generate least cost,” said Francis. “JPS has equal opportunity to bid and to participate as any other bidder.”
Bidders must submit a refundable security deposit equivalent to one per cent of the total proposed cost. They must also submit a non-refundable fee of US$8,000.
The security deposit can be sent to the OUR in the form of a cheque or a letter of credit. It can be held for up to a year, reasoned participants. Additionally, the OUR told the
Prospective investors flooded the 115MW project meeting hosted by the Office of Utilities Regulation, on Thursday, January 17, 2013, at The Jamaica Pegasus hotel in New Kingston.-CONTRIBUTED
Steven Jackson, Business Reporter
This article was originally published online on Friday, January 18, 2013.
Prospective investors complained about parking millions of US dollars as a security deposit via the government regulator Office of Utilities Regulation (OUR) for bidding on 115 megawatts (MW) of clean energy projects.
They also want safeguards against monopoly distributor Jamaica Public Service Company effectively underbidding them in applying for these projects – as it already controls the grid.
JPS is one of 85 entities which submitted expressions of interest for the 115-megawatt renewable projects. Proposals must be submitted by April.
The OUR noted the financial concerns while indicating that investors can use it as a JPS intermediary.
Over 200 prospective investors – one-quarter foreigners – attended an OUR meeting at The Knutsford Court Hotel in Kingston Thursday. The turnout “pleasantly surprised” OUR representatives.
It indicated the financial interest in renewable energy that forms part of the Government’s 2030 vision to reduce the island’s costly dependence on fossil fuels.
But one participant, general manager Wigton Wind Farm, Earl Barrett, complained of an additional financial burden requiring developers to put up at least 20 per cent of the financing of the project, which obviates full financing by banks.
Responding to the concerns, Peter Johnson, OUR manager of utility monitoring and generating procurement, said: “We want some commitment from the developers themselves. We do not want them to be just a conduit. That is the idea. We want some commitment from the developer.”
“It is not unreasonable,” added Courtney Francis, senior regulator of engineering at the OUR.
Leo Williams, seeking to represent bidders, said inter-connection with JPS would pose another hurdle in seeking financing for projects.
JPS can charge a higher fee to rivals to connect to the grid and a lower charge to itself, said Williams and other participants.
“The question of JPS and the level playing is one of which I hope you have heard. The concern expressed relates to the inter-connection costs to the (bidders) which are totally uncapped from the JPS side. So JPS could indicate all types of requirements which could drive the inter-connection costs up for the (bidder),” said Williams, who then asked in vain for the regulator to provide some indicative empirical costings.
“That would be rather difficult. We cannot give a per-unit cost because it depends on the technology, configuration, depends on where you are accessing the system from, the size, and a whole raft of things. It’s hard to quantify such costs,” Francis responded.
Industry players negotiate interconnection based on a minimum rate set by the OUR.
Renowned lawyer Frank Phipps queried the fairness of the inter-connection arrangement and whether in previous bids, rivals won over JPS bids.
“There have been previous applications where the JPS won and others in which others have won,” stated Johnson, who later added: “Please be reminded that there are already other independent power providers on the system and interconnection was a part of those arrangements. We have not seen or heard of concerns by those persons. So we are not aware of a foundation for these concerns at this time,” said Johnson.
Finally, Johnson sought to allay fears: “If you have difficulty dealing with the operator (JPS), we recommend that you submit queries to us.”
Two Petroleum Corporation of Jamaica representatives asked why not allocate a maximum slot for JPS to bid and offer the remainder to other players.
“We do not want suboptimal solutions. So we do not want to set aside anything without knowing it will generate least cost,” said Francis. “JPS has equal opportunity to bid and to participate as any other bidder.”
Bidders must submit a refundable security deposit equivalent to one per cent of the total proposed cost. They must also submit a non-refundable fee of US$8,000.
The security deposit can be sent to the OUR in the form of a cheque or a letter of credit. It can be held for up to a year, reasoned participants. Additionally, the OUR told the
Prospective investors flooded the 115MW project meeting hosted by the Office of Utilities Regulation, on Thursday, January 17, 2013, at The Jamaica Pegasus hotel in New Kingston.-CONTRIBUTED
Steven Jackson, Business Reporter
This article was originally published online on Friday, January 18, 2013.
Prospective investors complained about parking millions of US dollars as a security deposit via the government regulator Office of Utilities Regulation (OUR) for bidding on 115 megawatts (MW) of clean energy projects.
They also want safeguards against monopoly distributor Jamaica Public Service Company effectively underbidding them in applying for these projects – as it already controls the grid.
JPS is one of 85 entities which submitted expressions of interest for the 115-megawatt renewable projects. Proposals must be submitted by April.
The OUR noted the financial concerns while indicating that investors can use it as a JPS intermediary.
Over 200 prospective investors – one-quarter foreigners – attended an OUR meeting at The Knutsford Court Hotel in Kingston Thursday. The turnout “pleasantly surprised” OUR representatives.
It indicated the financial interest in renewable energy that forms part of the Government’s 2030 vision to reduce the island’s costly dependence on fossil fuels.
But one participant, general manager Wigton Wind Farm, Earl Barrett, complained of an additional financial burden requiring developers to put up at least 20 per cent of the financing of the project, which obviates full financing by banks.
Responding to the concerns, Peter Johnson, OUR manager of utility monitoring and generating procurement, said: “We want some commitment from the developers themselves. We do not want them to be just a conduit. That is the idea. We want some commitment from the developer.”
“It is not unreasonable,” added Courtney Francis, senior regulator of engineering at the OUR.
Leo Williams, seeking to represent bidders, said inter-connection with JPS would pose another hurdle in seeking financing for projects.
JPS can charge a higher fee to rivals to connect to the grid and a lower charge to itself, said Williams and other participants.
“The question of JPS and the level playing is one of which I hope you have heard. The concern expressed relates to the inter-connection costs to the (bidders) which are totally uncapped from the JPS side. So JPS could indicate all types of requirements which could drive the inter-connection costs up for the (bidder),” said Williams, who then asked in vain for the regulator to provide some indicative empirical costings.
“That would be rather difficult. We cannot give a per-unit cost because it depends on the technology, configuration, depends on where you are accessing the system from, the size, and a whole raft of things. It’s hard to quantify such costs,” Francis responded.
Industry players negotiate interconnection based on a minimum rate set by the OUR.
Renowned lawyer Frank Phipps queried the fairness of the inter-connection arrangement and whether in previous bids, rivals won over JPS bids.
“There have been previous applications where the JPS won and others in which others have won,” stated Johnson, who later added: “Please be reminded that there are already other independent power providers on the system and interconnection was a part of those arrangements. We have not seen or heard of concerns by those persons. So we are not aware of a foundation for these concerns at this time,” said Johnson.
Finally, Johnson sought to allay fears: “If you have difficulty dealing with the operator (JPS), we recommend that you submit queries to us.”
Two Petroleum Corporation of Jamaica representatives asked why not allocate a maximum slot for JPS to bid and offer the remainder to other players.
“We do not want suboptimal solutions. So we do not want to set aside anything without knowing it will generate least cost,” said Francis. “JPS has equal opportunity to bid and to participate as any other bidder.”
Bidders must submit a refundable security deposit equivalent to one per cent of the total proposed cost. They must also submit a non-refundable fee of US$8,000.
The security deposit can be sent to the OUR in the form of a cheque or a letter of credit. It can be held for up to a year, reasoned participants. Additionally, the OUR told the
Steven Jackson, Business Reporter
Economic windfalls are expected as wind operators seek to increase their supply of energy to the electricity grid to seven per cent from the current 2.5 per cent in the near term, saving more than J$1 billion annually in oil imports.
That is according to Dr Mario Anderson, group managing director, Petroleum Corporation of Jamaica (PCJ).
The PCJ-operated Wigton Windfarm in Manchester produced enough energy to save the country more than US$5.3 million (J$493 million) on oil imports during fiscal year 2011/12 or 47 per cent more year on year, due to its own expansion.
Dr Anderson said there are plans to generate a further 24 megawatts of wind power.
Another alternative energy supplier, Clean Alternative Energy Limited (CAEL), also plans to construct a 24 megawatt facility. That facility, to be based in Manchester, would raise the nation’s wind energy output by some 60 per cent.
CAEL directors include Wesley McLeod, businessman; Christopher Townsend, attorney; and Roger Williams, quantity surveyor.
“CAEL is estimated to save Jamaica US$4 million per year in fuel import costs annually, as approximately 40,183 barrels of oil equivalent will be saved per year in imports at an average price of US$100,” said the company in an environmental impact assessment report to the National Environment and Planning Agency.
The combined saving from Wigton and CAEL, however, would save only a fraction of Jamaicas annual oil bill, which hit US$2.4 billion in 2011. But the economic savings are augmented by the environmental benefits.
Wigton accumulated nearly 76,000 units of tradable carbon credits or certified emission reductions (CERs) in fiscal year ending 2012, equivalent to some US$375,000 based on estimates of existing rates.
Wigton earned some 52,000 CER units a year earlier. Carbon credits are worth about US$5 per tonne or unit.
CAEL said that its facility slated for Great Valley, Manchester would draw visitors to the area.
“The installation of the wind farm at Great Valley may lead to an increase in visitors to the area. There will likely be school trips as well as visits by persons who are interested in viewing the installation. The company said.
This may lead to increased commercial activity in the nearby towns. The Wigton farm located less than five kilometres from the proposed Great Valley wind-farm is said to receive thousands of visitors annually, it added.
CAEL plans to employ 100 persons during the nine to 12-month construction period but the cost of developing the wind-farm has not been disclosed.
Up to last year, the PCJ held the exclusive right to exploit and develop renewable resources in Jamaica.
In October 2012, the Government of Jamaica rescinded the PCJ’s exclusivity, which in effect liberalised the renewable energy sector.
steven.jackson@gleanerjm.com
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Oil moved in tandem with other risky markets after the US Congress approved a deal to avoid automatic tax rises and spending cuts that were forecast to bring on a recession.
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The increase is the third week in a row and takes the price of gasoline to a 10-week high.
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