By NEIL HARTNELL
Tribune Business Editor
The Bahamas was yesterday said to have left its abundant renewable energy resources “almost entirely unexploited to date”, with just $4.6 million invested in the sector over the past seven years.
The Inter-American Development Bank’s (IDB) Multilateral Investment Fund, in leaving the Bahamas’ ranked 21st out of 26 nations for renewable/clean energy in its Climatescope 2013 report, described this nation as having “made very little progress” compared to where it was last year.
This prompted Guilden Gilbert, the Bahamas Renewable Energy Association’s president, to again question why the Government’s energy reform process had decided to focus on the Bahamas Electricity Corporation (BEC) first, and leave dealing with renewables until 2014.
Arguing that the delay “doesn’t make any sense” especially in light of the latest Climatescope report, Mr Gilbert said the findings again showed the Bahamas was
lagging behind many of its Caribbean rivals.
On the positive side, Mr Gilbert said the report again reinforced that the Bahamas has the opportunity to generate “huge” cost savings via reduced fossil fuel imports, via the increased penetration of renewable energy.
Suggesting that Climatescope’s message was the Bahamas had “not even begun to take advantage” of its renewables potential, Mr Gilbert warned: “The opportunity is being lost”.
The Multilateral Investment Fund (MIF) report left the Bahamas’ ranking from 2012, handing it a 0.8 score based on assessments of four categories: legislative and regulatory framework; clean energy investment and financing climate; low carbon business and clean energy value chain; and greenhouse gas management activities.
“The country made very little progress compared to last year’s edition, and thus stayed level in the rankings,” the Climatescope report said of the Bahamas.
“Thanks to ample sun, a well-developed financial sector, and high-priced imported energy, the Caribbean archipelago has excellent opportunities for local clean energy development that have gone almost entirely unexploited to date.”
The Climatescope report noted that the Bahamas’ 575 Mega Watts (MW) of generation capacity was almost entirely dependent on fossil fuels.
It added: “Since the country produces no fossil fuels, Bahamian consumers must bear the burden of high electricity rates associated with imports; retail electricity prices averaged $0.23/kWh (per kilowatt hour) in 2012.
“Bahamians pay the fifth-highest price for power among the 26 countries assessed in Climatescope, averaging $0.23/kWh. Industrial customers pay even more – a striking $0.34/kWh.”
The Bahamas fared worst on its legislative and regulatory framework, the absence of incentives - or anything to facilitate renewable energy - ranking it 23rd in this category with a 0.59 score.
“The island nation does not have any policy incentives to encourage clean energy development. In addition, the Bahamas’ small power market is dominated by two utilities, one private and one public. This set-up inhibits the entrance of new players,” the report said.
It remains to be seen whether the Bahamas’ Climatescope ranking improves in 2014, as it appears little to no credit was given for the current Bahamas Electricity Corporation (BEC) reform process, which is expected to lead to deregulation/liberalisation of the energy sector, and the incorporation of renewables into the energy matrix.
And Prime Minister Perry Christie earlier this year reaffirmed the Government’s goal of having 30 per cent of all electricity in this nation generated by renewables come 2030, with 10 per cent - one-third of this amount - produced by businesses and households.
This, too, did not feature in the Climatescope report.
“Until now, however, renewables have had a very limited presence on the islands. The Bahamas has no policy incentives directed at the sector, and only $4.6m was invested in clean energy between 2006 and 2012,” the report added.
“With high insolation rates, high power prices and a healthy financial system, the Bahamas has vast potential for solar energy deployment. Despite these favourable conditions, however, the country has seen very little renewable energy-related activity so far.
“On the Greenhouse Gas Management Activities parameter, the Caribbean island nation made it to 17th position. It has one project operating under the UN’s Clean Development Mechanism (CDM): a 1MW landfill gas plant located in Freeport, Grand Bahama.”
The Bahamas fared best on renewable energy investment and climate, finishing 10th out of 26 with a 1.19 score. This was largely thanks to its strong financial services industry, and “the second-lowest swap rates in the region.
“Such rates could eventually result in low-cost financing becoming available to renewables and a jump-starting of development in the country,” Climatescope 2013 added.
Still, only Haiti, Guyana, Trinidad & Tobago, Barbados and Suriname finished below the Bahamas in the Climatescope overall rankings.
Describing the Bahamas’ 21st spot as “not surprising”, Mr Gilbert told Tribune Business:
“The Government just doesn’t seem to be moving forward with renewables.
“This thing about delaying until 2014, it doesn’t make any sense if the country is going to move forward with renewables. It either is or it isn’t.
“There’s no point in delaying. Right now, the Bahamas is falling behind its Caribbean counterparts. I don’t understand the delay. Why delay it? Why just not move forward with it now?”
Mr Gilbert said there were several utility-scale solar photovoltaic (PV) projects currently underway in the region, including one valued at around $80 million. Jamaica, too, was generating 38 MW annually from the Wigton wind farm.
The Bahamas Renewable Energy Association chief added, though, that the Climatescope report had again highlighted the “potential” for this nation to “cut drastically” its fuel import bill that runs into hundreds of millions of dollars annually.
“The fuel savings to the country would be huge,” Mr Gilbert told Tribune Business. “I think the opportunity is being lost. I definitely think opportunities are being lost to the Bahamas, and the country continues to pay the high cost of electricity when solutions are available and come at no cost to it.”
Kenred Dorsett, minister of the environment, could not be reached for comment.