Can Jamaica realise its saving potential from renewables?
On the face of it, renewable energy should translate into savings for Jamaica.
BMR Energy signed a deal on Wednesday to sell Jamaica Public Service Company (JPS) electricity from its planned 34 megawatt (MW) wind farm at 12.9 US cents ($14.30) per kilowatt-hour (kWh).
Bruce Levy reckons that the rate is almost half the cost of electricity generated from the oldest, most inefficient diesel plants currently in operations in Jamaica.
"At worst, using diesel fuel in an older engine, it might cost up to 25 US cents," the CEO of BMR Energy told the Business Observer. "If you use heavy fuel oil (HFO) in a modern engine you might end up in the teens (US cents per kWh). With natural gas you could easily end up in the 14 US cents range."
The new energy company, which was one of three bidders to be given the nod to build out large-scale renewable projects in Jamaica, plans to construct its wind farm using 11 turbines located along a ridge line just west of JPS's 3 MW wind farm in Munro, St Elizabeth.
When fully operational, it expects to deliver up to 120,000 megawatt-hours (MWh) to the grid each year, which is hardly a stretch given that Wigton's 38.7 MW wind farm put out 116,000 MWh last year. That represents about three per cent of total energy production in Jamaica.
But wind-power technology is not yet able to replace load requirements for the electricity grid, particularly since it only generates electricity when there is sufficient wind, like sun in the case of solar.
"Output changes by month," explained Levy. "June is (Jamaica's) windiest month, July and August is less, and the rest of the year is pretty flat at low levels. This is why we needed two years of measurement to assess wind availability."
Managing power systems to handle intermittent supply is by far not a new science, but it often comes at a cost.
"When you have intermittent resources you have to have generation that can respond to the differences in how that wind or solar reacts," JPS CEO Kelly Tomblin told the Business Observer. "Wind is better than solar because it usually doesn't just suddenly goes off. And there is usually some predictability about it.
"But it requires JPS to have the flexibility to have units that are flexible enough to rise and fall with the production of wind. That's what we need to do now."
Load following power plants, which adjusts its power output as demand for electricity fluctuates throughout the day, typically are less efficient, slower to start up, more expensive to build and costlier to run than base load plants, from which the bulk of power is derived.
"There may be a plant that in its purest form has a very low heat rate of 6,000 (kilojoules per kilowatt-hour, or kJ/kWh) or above," said Tomblin of prospects for technology which are farm more efficient than Jamaica's system heat rate of 10,200. "But we might not be able to choose that if our national goal is to have 20 to 30 per cent renewable.
"Our system which peaks at under 650 MW can go below 400 MW off peak; 140 MW of renewable is going to require us to schedule and plan the system very strategically (to benefit from savings)."
Currently, JPS's 32 MW of wind and hydro power combined with Wigton's 38.7 MW brings the total installed renewable capacity to just over 70 MW.
Another 78 MW is scheduled to come on stream by next year, with BMR's wind farm, Wigton's additional 24 MW project at Rose Hill, and Content Solar's 20 MW planned project to be located close to Content Village in Clarendon.
Tomblin said that while JPS is supportive of the renewable projects, it needs an "integrated resource plan that looks at our load at what we expect to happen to that load and what resource is right for each location".
"We are working on that now."
Correctly balancing renewable energy resources with conventional power technology can also return huge economic and environmental benefits.
BMR estimates that replacement of old, existing generation with its wind output can translate into a reduction in Jamaica's oil imports by 250,000 to 300,000 barrels a year. That could conceivably save US$25 million from the oil bill each year.
It is also expected to lower emissions of carbon dioxide by two million tonnes and nitrous oxide by 7,000 tons annually, or the equivalent of the greenhouse gases given off by over 800,000 passenger vehicles each year.