Contributed article by the Private Sector Organisation of Jamaica

The Private Sector Organisation of Jamaica (PSOJ) has been looking at issues relating to energy and the environment in light of the critical impact on competitiveness.

The PSOJ believes that energy efficiency has to be improved, because of the adverse effects on the country’s balance of payments. Oil is consuming an increasing percentage of the country’s earnings – oil and petroleum products imports account for over 30 percent of the total value of imports and over 100 percent of total export earnings.

To this end, the PSOJ has secured funding from the EU, under the Proinvest facility, to undertake a regional energy and environmental management project in collaboration with private sector partners in Trinidad and Tobago. This would involve a review of the legislative and regulatory framework, energy and environmental audits for selected firms, training workshops, energy efficiency tool-kits for businesses, a learning and investment mission to the EU, and a regional conference to be held in Trinidad.

The membership base of the PSOJ spans the agro-processing, manufacturing, energy and tourism sectors. These sectors are facing increasing challenges from environmental degradation which threaten their sustainability. Trade and investment agreements with major trading partners increasingly require improved environmental practices in response to the threats posed by global climate change. Hence, there is a clear business need for environmental management. Additionally, achieving international competitiveness for export success has been critically impacted by energy consumption and rising costs. The economic policy frameworks for both countries have highlighted energy efficiency as an area that requires attention and action.

There has been little private sector collaboration at the regional level to address these issues. The PSOJ led energy and environmental management project to be undertaken this year, starting in April 2010, will utilize a private sector collaborative approach to create opportunities for regional inter-company partnerships and joint ventures in developing solutions to the energy problems facing the region.

As was noted at an ARPEL (Associacíon Regional de Empresas de Petróleo y Gas Natural en Latinoamérica y el Caribe – Regional Association of Oil and Natural Gas Companies in Latin America and the Caribbean) conference held in Jamaica in July 2009, the CARICOM region is generally characterized by a dependence on fossil fuels and less than 10% of total energy is supplied from renewable energy (RE). Challenges for RE include:

o Lack of consistent energy policies and strategies.

o Lack of energy expertise.

o Regional energy policy not yet approved.

o High debt burden of benefitting countries makes government

guarantees difficult.

o Low business acceptance of RE technologies due to cost structures favouring fossil fuels and little incentives.

o Banks are reluctant to fund RE/Energy Efficiency Projects, reflecting a

lack of confidence.

Additionally, there is a paucity of baseline information on energy and environmental management at the firm level. This reflects itself in a low level of awareness of the financial benefits of good energy and environmental policies and practices. There is a similar lack of knowledge of the potential opportunities in the carbon trading market.

The PSOJ energy and environmental management project will address some of these issues by establishing the current state of environmental/energy efficiency in Jamaica and Trinidad at the firm level, including the current state of the legislative and regulatory framework. From these findings policy recommendations and strategies can be submitted to the respective governments in Jamaica and Trinidad.

Tool kits for businesses in energy and environmental management and carbon trading will result in improved environmental and energy consumption practices, in addition to new income streams.

Stakeholders will be able to access the research findings and other relevant information coming out the project through an internet website facility to be developed. This knowledge resource would also serve to link businesses seeking investments in environmental/energy projects with potential investors.

The PSOJ looks forward to working with the government and stakeholders to improve the country’s energy and environmental management policy framework and infrastructure, and will be holding a public/private sector dialogue event on September 15, 2010, at the Pegasus Hotel in Kingston. Energy and Environmental management experts contracted to the project will lead the discussions to which all key stakeholders will be invited.