Barbados is one step closer to energy security and the long promised upgrade and expansion of the natural gas infrastructure, having officially launched its multi-million dollar Deployment of Cleaner Fuels and Renewable Energies programme today.
The project, which is being funded through a US$34 million loan from the Inter-American Development Bank (IDB), is intended to enhance the country’s energy security and sustainability by diversifying the energy mix through the promotion of renewable energy sources, as well as the modernization and expansion of the natural gas infrastructure.
Addressing the official launch at the IDB’s Maxwell, Christ Church office, Minister with responsibility for Energy, Senator Darcy Boyce said the programme formed part of the island’s thrust towards becoming one of the greenest economies in the Western Hemisphere.
He said the new project should result in a reduction in operation costs for the Barbados National Oil Company Ltd and the National Petroleum Corporation (NPC), which will have oversight of the project.
“Further, the project gets the national oil company into becoming a major producer of renewable energy, either by wind or solar, or both,” Boyce said.
The project has three components, the first of which will cost just over US$25 million, and involves the expansion and upgrade of the natural gas infrastructure.
The second component will cost US$3.35 million and will see the installation of photovoltaic systems, as well as energy efficient systems in administrative buildings, while the third component, costing US$4.05 million, will consist of technical advisory services, including the training of staff, as well as various studies.
The remaining US$1.6 million will be spent on evaluation , as well as management and monitoring efforts.
IDB Country Representative for Barbados Juan Carlos De La Hoz Viñas said just over 2,000 residents, seven businesses and two industrial customers are scheduled to be added to the natural gas grid, and, ultimately, the island’s entire 126,000 electricity users will benefit.
Meantime, Boyce put the IDB on notice that he would be approaching the institution for “a bigger loan” to expand an approximately US$5 million Caribbean Development Bank (CDB) pilot energy efficiency project.
“In all these things that we are doing, it is not just a case of Government just borrowing the money and having to find taxes to pay for it . . . . My view is that we can do all this renewable energy and energy efficiency work and let it pay for itself,” he said.
Adding that he has been getting “very good support” from Barbados Light & Power and the private sector, Boyce said those who were critical of the pace of expansion of the sector should be mindful of the processes involved, including legislative, regulatory and “other institutional issues”.
“The utility company also has a legislative responsibility in the law for the reliability of the power supply. Therefore, we have to make sure that whatever we do they are able to execute that responsibility properly,” Boyce explained.
“We also have to consider that they have plant and equipment, which have not all been paid off for, and to the extent that we move very quickly on renewable energy, we may strand some of those assets and then we will have to find a way for them to recover the money for those stranded assets.
“Now, if time comes and we do the numbers and it makes better [sense] for the whole country to strand those assets and pay them and move to renewable energy, then we will look at that decision when the time comes for that.”
It was following an increase in natural gas prices early last year that Prime Minister Freundel Stuart announced the IDB project would be implemented to carry out upgrades to the infrastructure, which has been in place since the early 1950s.
While expressing concern that natural gas was only reaching about 25 per cent of the domestic market and was not available in the rural parishes of St Lucy, St Joseph and St John, Stuart said then that the NPC intended to increase access of natural gas to domestic customers to an average of about 850 per year, more than double the current 350.