President of the Barbados Renewable Energy Association (BREA) Aidan Rogers believes Barbados has the potential to generate 80 megawatts of alternative power within the next three years, creating close to 3,000 jobs.
At the same time, Rogers suggested that the island could save about US$150 million in foreign exchange per year through reduced fuel imports.
However, addressing a breakfast seminar yesterday on The Role of The Financial & Insurance Sector in Advancing the Green Energy Initiative, he pointed out the sector was currently performing below capacity, while appealing to local financial institutions for more monetary support.
Rogers noted that the legal framework, including the Electric Light & Power Act, was now in place to facilitate the generation and sale of electricity.
However, he said the sector was currently operating at half its capacity of 20 megawatts, based on just over $50 million in investment and the creation of about 500 jobs in 30 companies under the Renewable Energy Rider (RER) programme over the past five years.
“There is a possibility that the grid can accommodate close to 80 megawatts of intermittent capacity, wind and solar,” said Rogers, who made reference to a recent Barbados Light & Power (BL&P) commissioned Renewable Integration study.
While acknowledging that BL&P’s parent company Emera was due to bring on stream the St Lucy solar energy project by next year, Rogers said, “it leaves a whole lot of investment space available and this is where we really want to appeal to your interest in the financial and insurance industry.
“We want to see at least 60 to 70 per cent of that investment funded through local capital within the banking and credit union movement,” Rogers said, noting that there was a cadre of young Barbadians who were being trained with the necessary skills in the installation of the various technologies.
“The relevance of this is that if we can have domestic capital investing in this sector, what it would do is create a multiplier effect in the economy where there will be greater tracks of disposable incomes within the hands of Barbadians,” he added.
The alternative energy advocate also suggested that greater investment would result in “some level of domestic economic franchisement.
“There is also the potential for this 80 megawatts within the next three years creating close to 2,500 to 3,000 local jobs,” he added.
However, he quickly pointed out that a number of things needed to be put in place, including the completion of a national sustainable energy policy, amendments to the Electric Light & Power Act and development of national standards.
Rogers said there was also need for a new physical development plan to facilitate onshore wind energy investment.
He called on stakeholders to let their voices be heard “in terms of advocacy, particularly for the call for the 60 to 70 per cent local investment”.
Vice President of BREA Jerry Franklyn joined the call for more local investment in the sector, warning that if too much overseas support was allowed, the island would not have accomplished much.
He said his biggest concern was how much the country was spending on fossil fuel imports, saying although he suspected the island was currently saving about US$200 million on its US$800 million fuel import bill per year given lower oil prices, this could change “at a moment’s notice”.
However, President of the Barbados Bankers’ Association Glyne Harrison said it was critical to the banking sector that certain guarantees were implemented.
“Who is responsible for the management, who is responsible for the numbers, who is responsible for the control of the systems, what guarantees do we have that the suppliers that you are interacting with will be in place five years from now?” asked Harrison.
“Also what we want to see is real viability behind the project, not just the numbers, because a business can be extremely profitable on paper but . . . at the end of the day . . . the person behind the business [does not] have the expertise or wherewithal to carry it to the level it needs to go to make the numbers come into reality. So that is a big part of the picture,” he explained.
In addition, he suggested that renewable energy advocates must be willing to put their own monies into their projects.
“Whether it be through crowdsourcing, family and friends or from my own personal stake,” he said.
“If you believe in the project and you believe in the business, be willing to put your personal [finance] into it and say, ‘I am willing to stand up’,” the banker added.
Meantime, Joseph Williams, Sustainable Energy Advisor at the Caribbean Development Bank (CDB) agreed there was a major gap in the financing of renewable energy projects by commercial banks.
He said the CDB was prepared to provide technical support to the banking community in terms of looking at some the financing models that could work.
Permanent Secretary in the Ministry of Energy Francine Blackman gave the assurance that the 20 megawatt capacity limit from intermittent sources to the grid would be increased “within the next few months”, but she opted not to say by how much.