By NEIL HARTNELL
Tribune Business Editor
European Union (EU) grant funding has helped provide the government with a near-$90m financing line in its bid to seize “an a historic opportunity to transform” the energy sector.
An Inter-American Development Bank (IDB) report, seen by Tribune Business, discloses that the initial $80m funding it provided to finance electricity infrastructure restoration in Abaco and other Hurricane Dorian-hit areas has been bolstered by the receipt of $9.739m in grant funding from the EU’s Caribbean Investment Facility.
This, the report adds, will produce “a 50 percent increase in renewable energy installed, and battery storage capacity for additional resilience”, as part of efforts to integrate sustainable sources into the build-back of Bahamas Power & Light’s (BPL) network.
Some $8.251m of the EU grant funding will be allocated to “the installation of a 4 megawatt (MW) Solar photovoltaic (PV) plant and energy storage”, occupying five hectares of government land and which will supply energy to the Marsh Harbour government complex and the island’s hospital.
It will also be used to subsidise rooftop solar PV installations on New Providence for a total additional renewable energy capacity of 2.5 MW. This will involve five commercial and 50 residential installations, of 50 kilowatts (Kw) and 5Kw, respectively, plus 20 systems for community buildings with a 100 Kw capacity.
“Additionally, the grant will finance a Solar PV plant of approximately 0.25 MW for the Coopers Town Medical Clinic, which will include a storage capacity of close to 2 MW,” the IDB report added.
“Furthermore, this component will finance the deployment of three decentralised solar PV plants in New Providence, which will add an approximate capacity of 1.1 MW. The EU grant contribution will expand the scope of the existing rooftop programme initiated by the IDB, which is currently in the development phase but about to start in the 2021 second quarter. There is no previous grant programme in The Bahamas for distributed generation.”
The Bahamas’ progress to-date in meeting the National Energy Policy’s goal of producing 30 percent of the country’s energy needs from renewable sources has been painfully slow. Renewables accounted for just 0.86 percent of the country’s energy generation mix at end-2020, and the Prime Minister’s Delivery Unit is targeting just 4.56 percent by 2023.
Nevertheless, the IDB report said: “To stimulate the advancement of renewable energy and break the strong dependance on fossil fuels, the Ministry of Finance is leading the national effort, acting by corralling stakeholders towards renewable energy in the country.
“The Bahamas has an historic opportunity to transform its energy matrix in the aftermath of Hurricane Dorian by addressing structural challenges that have made electricity costly and unreliable, constraining economic growth and dampening the quality of life for its population.
“The reconstruction and modernisation of the archipelago’s energy system is an opportunity to strengthen isolated and interconnected grid networks with resilient renewable energy resources, coupled with conventional power systems designed to withstand the increasing frequency and severity of extreme weather events,” the report added.
“It also presents an opportunity to raise awareness of renewable energy as a new energy sub-sector, and the skills, employment and economic opportunities this presents for Bahamian citizens. Finally, it will contribute to reducing the island’s use and dependency on fossil fuels, therefore increasing energy security and avoiding carbon dioxide emissions.”
The IDB’s $80m represents the first tranche in some $170m of funding it has approved for the Bahamian government to assist with these objectives, with the full sum expected to be drawn down in three phases over an eight to ten-year period.
Turning to BPL’s Abaco reconstruction, the IDB report said: “Pre-Dorian, BPL had approximately 8,879 active customers in Abaco and its associated cays, of which 8,182 would benefit from the reconstruction of the electricity transmission and distribution infrastructure.
“In the aftermath of the hurricane, Abaco experienced a sharp drop in electricity demand because of limited generation and loss of electricity customers. Nonetheless, both are quickly returning to pre-hurricane levels, with just over 6,500 customers reconnected to the grid.
“The goal is restoring infrastructure in a resilient manner, so that the existing and remaining 20-25 percent of customers benefit from reliable electricity service.”