CABINET has given approval for two energy-generation projects, totalling 330 megawatts, which will increase the country’s electricity generation capacity and reduce the cost to consumers.

The aim is 380 megawatts, however, the 50 megawatts expected from JAMALCO is now uncertain following the Noble Group’s takeover of Alcoa’s shares in the company’s operations last December.

Approval was given to the Jamaica Public Service Company (JPS) for the replacement of its 292 megawatts of heavy fuel oil power plant at Old Harbour in St Catherine with a 190-megawatt gas turbine generation plant, while Alpart got the green light to build a 140-megawatt gas turbine cogeneration facility at Nain, St Elizabeth.

“It (JAMALCO) is still included in the equation that we are considering (but) we cannot be definitive about that equation this morning because of the change in ownership at JAMALCO,” chair of the Electricity Sector Enterprise Team (ESET) Dr Vincent Lawrence told yesterday’s Jamaica House press briefing.

Lawrence disclosed that the ESET’s appraisal of the JAMALCO project has been set back as Noble wants to review the proposals left by the previous owners and devise its own plan.

“Noble Group has indicated a definite interest in energy solution but they want to review and analyse and make their own decisions.

They are leaning very heavily towards what ALCOA had recommended, but they are also re-analysing and ensuring that it’s best for what they would want to do as the new majority partners,” Lawrence told journalists. Noble is expected to make its decision known by the end of this month.

Lawrence, meanwhile, explained that the two- or three-month delay caused by the change in ownership would not result in an overall delay in the project. Nevertheless, Cabinet has agreed to “delay any final decision on JAMALCO” until the ESET has had a chance to carry out more analysis, he said. Lawrence said that even without the JAMALCO project, anywhere from 320 to 380 megawatts would be sufficient to address the country’s needs at this time.

“Even if that was to fall by the wayside, and I don’t believe it will. It may vary, it may be less or more, it would not create an issue by itself for us,” he added.

Furthermore, he said the Government has been reviewing a number of other options, including a proposal from Pan Caribbean Sugar Company for up to 20 megawatts from bagasse. In addition, the JPS got approval for the conversion of 115 megawatts of existing generation from automotive diesel oil to gas in Bogue, St James.

Lawrence noted that there are some challenges regarding the delivery of gas for that operation but that “we still feel it can be done by the end of 2015”.

Meanwhile, the enterprise team said Jamaicans should start seeing the cost of electricity dropping from a base rate of US$0.40 to between US$0.26 and US$0.27 per kilowatt hour by 2018, noting that the recent depreciation in oil prices was not taken into account.

The ESET chairman maintained that there should be a 30 per cent reduction in cost to consumers within three years, and that the commissioning of the new facilities by the end of 2017 was still the target. Residential customers now pay the JPS $19.35 per kilowatt hour for electricity.

The Government established the ESET in June 2014 to lead the procurement process for the development of additional base load generation capacity in order to significantly reduce the cost of electricity to Jamaicans, and diversify the energy supply mix.