Alternative Energy Licenses Issued in Jamaica

Licenses to alternate energy investors will be issued by the utilities regulator starting in 2006. The minister of science and technology expects this will encourage a 10 percent increase (100 MW of electricity) in the use of alternate energy over the next four years.

Jamaica’s total electrical generating capacity is 780 MW. Approximately 40 MW is provided by alternative energy. The Office of Utilities Regulation (OUR) projects that Jamaica’s will need an additional 120 MW electrical generating capacity by 2007 and another 120 MW by 2010. Jamaica imports oil that accounts for 95 percent of its energy source and the Jamaica Public Service Company (JPS) buys some power from few independent generating companies. However, the government of Jamaica intends to aid with the development of alternative energy by establishing an energy fund with US$10 million in seed capital from the Venezuela-promoted PetroCaribe energy initiative. In addition, the government has formulated a standard offer for investors. Therefore, alternative energy investors that occupy a license will not be required to negotiate with the JPS. The OUR has already agreed on the premium price that will be paid for the electricity that alternative investors generate. The rate is 15 to 25 percent above the cost that would be applied to JPS if they were to provide additional generating capacity to the grid.