It will require an estimated $3 billion worth of investment in a diverse set of renewable energy sources if Barbados is to achieve its goal of 100 per cent renewable energy usage by 2030.
At the same time, officials are predicting that the island could reap as much as $2.5 billion in economic benefits within ten years of becoming 100 per cent dependent on renewable energy sources.
Chief Project Analyst in the Ministry of Energy and Water Resources Brian Haynes said investment was critical if Barbados was serious about achieving its vision for the sector, adding that without diversity “we are not going to make the targets that we are hoping to make”.
“This diversity needs about 545 to about 550 megawatts of power dependent on the configuration that we advance. We are talking about capital investment of between BDS$2.4 to BDS$3 billion. This level of investment is large, but it is not insurmountable because we have a certain amount of liquidity here. We also need to be able to unlock that liquidity to get that investment happening,” Haynes told the opening of a high level round table meeting on the renewable energy industry at the 3W’s Pavilion at the University of the West Indies (UWI), Cave Hill Campus on Monday.
“With that investment the expectation is, and we are talking about ten years in the future and beyond, BDS$2 billion to BDS$2.5 billion [annually on average] in terms of economic profit. That takes into consideration not only what is done with the firms and businesses and households, but it also the indirect – so those persons who are working and investing [in the sector],” Haynes explained.
A 100 per cent renewable energy policy means that the country would move from its current 944 gigawatt hours (GWH) per year usage to between 2,000 and 2,400 GWH/year.
Data showed that between 2006 and 2015 Barbados was importing an estimated 11,654 barrels of oils per day to meet its needs.
The rate of solar photovoltaic electricity going to the national grid slowed considerably in 2017 to reach a mere 0.01 per cent, after a spike in 2013 when oil prices reached an all-time low of about US$30 a barrel.
Up to the end of 2017, only 3.8 per cent of electricity or 27 megawatts came from solar photovoltaic systems.
Haynes explained that a lack of implementation, a lack of adequate financing and human resources, low technical capacity and low pricing certainty had led to low investor confidence over the years, which had hampered the expansion of the renewable energy efforts.
He said in order to achieve the island’s energy goal a multipronged approach was necessary, which would tackle energy for cooling, lighting, transportation as well as energy efficiency.
“We cannot only look at the 900 plus gigawatt hours we are currently consuming, but we have to speak about what is happening on the road. The transportation sector accounts for between 37 and 40 per cent of our fuel consumption and we have to address that,” insisted Haynes.
Executive Director of the Barbados Renewable Energy Association (BREA) Meshia Clarke said she believed the recovery of the ailing Barbados economy depended heavily on the renewable energy sector.
She insisted that as Government embarked on its mission critical action plan to address Barbados’ balance of payment challenges, the renewable energy sector should be given priority.
“What is needed more urgently now than ever is the recognition that the country’s economic recovery must be aligned to an overall strategy [that addresses] economic growth and curtails our foreign debt,” said Clarke.
“Our position has been centred [on] the understanding that the renewable energy and energy efficiency sector present a pathway for the country to stimulate economic growth through the creation of new job opportunities, increased investment prospects and [an] overall reduction in the level of foreign exchange spend on purchase of oil,” she explained.
Acknowledging that Government’s policy objective regarding the sector will require significant levels of investment, Clarke said banking institutions and insurance companies have a significant role to play.
Monday’s meeting among private and public sector representatives, donor organizations and other stakeholders, and insurance and financial services sector officials, sought to among other things, identify a new coordinated and collaborative approach towards developing the sector.