The energy cost in the Caribbean is the highest in the Western Hemisphere and amongst the highest in the world. The cost of energy in various islands range from as low as US$0.20/kwh to as high as US$0.37/kWh. Because the area is big in the tourism industry all year round, the Caribbean has been looking for ways to offset the amount of fossil fuels used to run the islands with renewable sources of energy and energy efficient projects.
1) The Caribbean Renewable Energy Development Program. The Caribbean Renewable Energy Development Program (CREDP) was established in an effort to improve the regulatory, legal, and political framework conditions associated with the utilization of renewable energy and energy efficiency throughout the entire Caribbean region. The main objective is to reduce the dependence on fossil fuels and reduce carbon dioxide emissions. Projects focus on providing strength to all regional energy sector institutions; work with the government on making renewable energy and energy efficiency policies; preparation of various clean technology projects for investment decisions; and public awareness campaigns.
2) Arch Solar. One of the main solar energy services in the Caribbean is Arch Solar. Arch Solar believes in promoting renewable energy as a practical solution to meet all demand for energy. This company custom designs, supplies, and also installs various renewable energy systems to homes and businesses. The offer some of the highest energy efficiency panels in the world, flexible thin-film technologies, and panels that are architectural building integrated.
3) Caribbean Renewable Energy Technical Assistance Facility. Funded by the Global Environmental Facility, the Caribbean Renewable Energy Technical Assistance Facility (CRETAF) is a $1.3 million initiatives that offers assistance for preparation of renewable energy projects through grant financing for all countries that participate in CREDP. Assistance offered includes pre and full feasibility studies, grid stability studies, environmental impact assessment, and resource assessment.
4) IDB Funds Energy Efficiency in the Caribbean. In 2009, the Inter-American Development Bank approved three energy efficiency projects throughout the Caribbean. $1.45 million was given to the Bahamas to strengthen the Ministry of the Environment’s capacity and assist in supporting the sustainable energy matrix and encourage the use of energy efficient measures in public, residential and commercial buildings. $1 million went to Barbados to develop a Sustainable Energy Framework to assist with the minimization of fossil fuel dependency. Finally, another $1 million went to help start the Caribbean Hotel Energy Efficiency Action Program.
5) Member of the Renewable Energy and Energy Efficiency Partnership. The Caribbean partnered with Latin America to create the Renewable Energy and Energy Efficiency Partnership (REEP). The objective of REEP is to decrease the barriers that limit the overall uptake of clean technologies with a specialized focus on developing countries and emerging markets. REEP assists member governments with developing favorable policy and regulatory frameworks and promoting innovative business and finance models in an effort to activate the country’s private sector. REEP has created a number of initiatives, including the Sustainable Regulation Network, the Energy Efficiency Coalition, and the Renewable Energy and International Law sub-networks.
6) Caribbean Hotel Energy Efficiency Action Program. To become more energy efficient, the Caribbean tourism sector has taken a number of important strides, including the creation of the Caribbean Hotel Energy Efficiency Action Program (CHENACT). CHENACT was created through the Caribbean Tourism Organization, the Caribbean Hotel and Tourism Association, and the Caribbean Alliance for Sustainable Tourism. It is a $2 million project that is to assist hotels in implementing energy efficiency practices and renewable energy generation. Barbados was used as a case study to look at how to design and prepare energy efficiency program as well as institutional strengthening. CHENACT is looked at as a way to reduce the high energy costs of the region.
7) World Bank Invests in Energy Efficiency Projects in Jamaica. In 2010, the World Bank provided $2.5 million to Jamaica to support the energy efficiency efforts in the private sector. The funds were taken from the bank’s World Energy Security and Efficiency Project and are slated to support a pilot energy efficiency financing mechanism that will enable the private sector to have access to energy efficient and renewable energy equipment. The support mechanism has the ability to introduce energy efficiency and energy saving conditions to home improvement loans.
8 ) Gross Feed-in Tariff Approved in the Cayman Islands. In March of 2011, the Cayman Islands gave approval for a limited pilot program that consists of a gross feed-in tariff for utility-customer sited renewable generation. The program will run through 2012. The feed-in tariff will pay for all generation from customer-sited generators. The program cap is on one megawatt – 70 percent of it is reserved for commercial customers.
9) Incentives for Renewable Energy Investments in Dominican Republic. With the energy consumption in the Dominican Republic quickly rising, it has become imperative to look into renewable energy. Currently there have been a number of joint investments in electricity generation from renewable sources, including solar and wind. Through the Law on Renewable Energy Incentives and Special Regimes, a number of benefits are provided to companies investing in renewable energy in the country, including an exemption on all taxes associated with imported equipment and sales, tax reduction on interest payments of five percent, tax credit of up to 75 percent of all income tax for industrial and commercial auto produces, low interest financing up to 75 percent of full cost of renewable energy projects, and feed-in tariffs.
10) Agreement for Research and Development of Biodiesel in Curacao. The government of Curacao signed a cooperation agreement with Refineria Korsou and Curoil to study the use of biodiesel in the Caribbean island of Curacao in an effort to obtain a new form of renewable energy. The organization Fundashon Antiano pa Energia has been tasked with conducting pre-study projects on sustainable diesel development and crease a road map that would allow for the full development of sustainable diesel on the island. Through the pre-study, it is hoped that there is the creation of the overall possibility to fully replace fossil fuels with biodiesel and eventually biomass as well.
Article by Shawn Lesser, Co-founder & Managing Partner of Atlanta-based Watershed Capital Group – an investment bank assisting sustainable fund and companies raise capital, perform acquisitions, and in other strategic financial decisions. He is also a Co-founder of the GCCA Global Cleantech Cluster Association ”The Global Voice of Cleantech”. He writes for various cleantech publications and is known as the David Letterman of Cleantech for his “Top 10″ series. He can be reached at shawn@watershedcapital.com
