By Rebecca Theodore:
At a time when the world is experiencing an energy crisis, the process
of rising heat from the earth as a stimulant to economic growth becomes
very beneficial to many Caribbean nations. However, while many
contemplate that geothermal energy is an ambitious opportunity to
utilize wealth and recognition among member states and international
markets, the financial challenges associated with it are many and
varied, and now beckons the need for international ‘tenders’ to promote
the sound development of the project.
Scientific evidence further illustrate that geothermal energy is a major
factor in combating the adverse effects of climate change in the
Caribbean. Geothermal energy doesn’t produce any type of greenhouse
effect, and does not consume any energy since it’s renewable energy and
there is no consumption of any type of fossil fuels.
In all truism, geothermal energy in the Caribbean have the prospective
to address economic development, climate change mitigation, and
stipulation of affordable energy and should be listed on the United
Nations Millennium Development Goals (MDG) as an alternative to poverty
reduction and to energy security.
Yet, unethical clouds smudge the dust for action and solutions.
So what if anything should Caribbean government’s make of the financial
challenges facing geothermal energy? For one, Caribbean islands are now
locked in long term contracts that have no incentive for power producers
to develop more economic methods in order to maximize benefits.
Market research reports that “electrical supply across much of the
Caribbean is generated by expensive and polluting oil- or diesel-fired
generators and millions of dollars are spent on fossil fuel imports.”
Economic analysts further state that “it is the high cost of energy that
presently paints the un-competitive business portrait for the Caribbean
on the international market. Dependency on imports of foreign fossil
fuel affect the balance of payment and contribute toward micro and
macroeconomic challenges, such as inflation, increased cost (and loss of
competitiveness) of local industry, depreciation pressures, and further
In essence, “the future of geothermal energy in the Caribbean “is very
bright,” but Caribbean governments cannot undertake the project solely
admits Sturla Birkisson, senior vice president at Iceland Drilling
Company. In this light, government money and international funds are
needed to mitigate the financial risk and cover the initial costs in the
form of soft loans in case exploratory projects prove unsuccessful.”
Energy Sector Management Assistance Program (ESMAP) of the World Bank
published report further states that “the main challenges associated
with the development of geothermal energy generation in the Caribbean
includes the financial resources needed to confirm the resource
potential of specific sites, financing of exploration, production and
injection wells, and power plant development. The legal and regulatory
framework, the lack of a comprehensive inventory of geothermal resources
with high quality data, environmental and social impacts, and power
sector planning are also other adversary factors.”
As a result, if financial measures are to be met in the cultivation of
geothermal energy, then Caribbean governments will “need to develop
resources themselves, or negotiate a fair price with a responsible
developer that puts some value to the community and supports the growth
of it and stimulates its development.”
Given these circumstances, the most dramatic illustration of the
financial challenges of geothermal energy now shines light on the
Caribbean island of Dominica. With the highest percentage of renewable
energy in its energy mix among Caribbean nations, it would take an
exceptional scale of energy tone deafness not to mention the Skerrit
administration energy policies.
Even for a government that now boast that it has spent more than $US12
million in developing the geothermal industry on the island, and has
sought the advice of the Clinton Climate Initiative, and presented the
project as one of its theme at the sixty-seventh session of the United
Nations General Assembly; it still fails to show the political will and
leadership to enlarge and diversify the ‘portfolio of options’ that
geothermal energy entails.
Subsequently, the project lies crippled in cronyism and unprofessional conduct.
Perhaps proponents may want to evidence leaked diplomatic cable released
by Wikileaks that allege the United States embassy in Barbados is
unfavorable to the government of Dominica’s plan on moving forward in
developing the island’s geothermal potential, but if as the Dominica
prime minister asserts that “one of the weaknesses of Renewable Energy
(RE) initiatives and Efficient Energy initiatives (EE) in the Caribbean
is the lack of projects to demonstrate the benefits,” then, the
harnessing of geothermal energy cannot continue to be cloaked in secrecy
and locked in a partisan political play.
In order to maximize the benefits of geothermal energy in the Caribbean,
it is clear, that bi-partisan efforts and inputs from environmentalists
and consultants are needed to help government negotiate a fair price
with international developers.
Progressively, the long-term needs of energy security in the region is
now of high importance and at this point, Caribbean governments should
seek to develop an “integrated project management solution” and a
systematic review and re-examination of geothermal resources for energy
production. It would not only help in meeting the ongoing energy crisis
in the world at large and boost the national security of many Caribbean
nations, but it will also become a valuable alternative energy source
for future generations.
Thus, it is now evident that the answer to wealth and recognition for many Caribbean nations lie beneath.
September 04, 2014
Caribbean News Now