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Reflections from Samoa: "Renewable energy for economic development in the Caribbean" Nicole Leotaud Caribbean Natural Resources Institute (CANARI) There are three drivers for scaling up renewable energy in the Caribbean islands: energy security to reduce dependence on expensive imported fossil fuels; fossil fuel costs and price volatility and the knock- on effect on competitiveness of goods and services; and environmental concerns around the contribution of fossil fuels to climate change. For the Caribbean, the first two economic arguments are driving the growing interest in wind, geothermal and solar energy as the top options. The Third International Conference on Small Island Development States (SIDS) in Samoa featured renewable energy as one of the key themes in the plenary presentations by Caribbean countries and during side event discussions. Dr. Didacus Jules, Director General of the Organisation of Eastern Caribbean States (OECS), gave an excellent summary assessment of the drivers for change and the renewable energy initiatives and issues. Dr. Jules outlined the three drivers for scaling up renewable energy in the Caribbean islands as: energy security to reduce dependence on expensive imported fossil fuels; fossil fuel costs and price volatility and the knock-on effect on competitiveness of goods and services; and environmental concerns given the contribution of fossil fuels to climate change. With electricity access almost 100% across Caribbean countries (except for Haiti and Guyana), and low carbon emissions per capita (with the embarrassing exception of Trinidad and Tobago, which has one of the highest in the world but seems to be unconcerned about it), the real energy issue is around security and cost. Some Caribbean countries have pursued PetroCaribe agreements, where Venezuela offers very concessionary rates under a debt swap arrangement. This has received mixed reviews internationally resulting in increasing debt of Caribbean countries to Venezuela. In fact, Dr. Jules reported that debt is now approaching US$5 billion for borrowing countries. However, without this option, Dr. Jules feels that the OECS countries would have been in terminal economic crisis. With the death of President Chavez and uncertainty about the future of these arrangements, the OECS now wants to manage the relationship more strategically, for example via exploring sinking funds and trade arrangements. As petroleum imports continue to dramatically increase across the OECS, vital foreign exchange is being spent that needs to go towards paying off the incredible debt burdens. In his plenary statement, Dr. Dominica's Minister for Environment, Natural Resources, Physical Planning and lamented that "once we stop sending so much of our precious foreign exchange out of our countries we can stop the bleeding." The cost of electricity in the OECS is among the highest in the Caribbean and this is having serious knock- on impacts on the costs of goods and services, adding to other challenges that reduce competitiveness of Caribbean products in regional and international markets. With limited export opportunities, Caribbean countries cannot earn the foreign exchange required for energy purchases, far less for debt servicing. International non-profit organisation, the Carbon War Room, noted that less than 5% of the energy in the Caribbean is renewable, and highlighted key barriers as: • the monopoly by public or private utilities on generation, distribution and transmission; • lack of investor confidence because of high risks and a weak policy environment; Kenneth Darroux, Fisheries,PDF Image | Renewable energy for economic development in the Caribbean
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