Jamaica (2012)

Degree of reliance on imported energy:

Due to the lack of indigenous energy resources and low utilization of available renewable sources, Jamaica depends on imported fuel for over 90% of its energy needs. 
 
In 2007, Jamaica imported 30 million barrels of oil at an approximate cost of US$2008 million, or US$36.19 per barrel, the single largest imported commodity. Petroleum is imported from Mexico and Venezuela under the San Jose Accord, as well as from the Ecuadorian oil company Petroecuador and Trinidad/Tobago. The aluminium - bauxite industry is the most energy-demanding sector, it accounts for more than 48% of oil imports. 
 
In late 2005, the Government of Jamaica updated its 1996 energy policy and developed an energy strategy for 2006-2020/25 The updated strategy focuses on increasing the consumption of liquefied natural gas through imports from Trinidad and Tobago – efforts which began earlier in the decade. Following feasibility studies, which concluded that demand from the bauxite/aluminium industry and power sector was sufficient to make the investment (current market potential is 2.5 million tons per year), the government signed a Memorandum of Understanding with the government of Trinidad and Tobago in 2004 to supply 1.15 million tons per year of liquefied natural gas for a 20-year period to the Jamaica Aluminium Company and the Jamaica Public Service Company.

Main sources of Energy:

Total installed electricity capacity (2010): 1,161 MW 
Oil: 90%. 
Coal: 1.5% 
Hydro-electricity: 2.2 % 
Biomass: 1.4%. 
 
7.4 billion kWh were generated and 6.5 billion kWh were consumed. 
 
Through its National Energy Policy 2009-2030, the supply mix is expected to have marked changes by 2012 when petroleum is expected to represent 67% of the mix, natural gas 15%, petcoke/coal 5% and renewables 12.5%. By 2030, the share of petroleum in the supply mix is expected to be only 30%, with natural gas accounting for as much as 42% of the mix and renewables 20%.

Country:

Jamaica

Extent of the network:

National electrification rate (2006): 90%.

The Rural Electrificacion Program (REP) aims to extend electricity to rural Jamaica as part of the Government of Jamaica’s commitment to provide the entire island with access to electricity.

Capacity concerns:

Jamaica’s dependence on imported petroleum renders the country vulnerable to disruptions in its energy supply as well as to increases in the price of oil, such as took place in 1973 and more recently in the past five years from 2002 when the annual average spot peak price of crude oil on the international market increased by 184% from US$25 per barrel in 2002 to US$71 in 2007. 
 
In 2008, Jamaica imported between 29 million barrels of oil approximately at a higher cost of US$2,900 million. Although Jamaica's oil demand has dropped due to efficiency efforts and alternative energy projects developed, the oil price fluctuations have led to increasing costs. 
 
50% of the island’s electricity generating plant is over three decades old, has exceeded its intended useful economic life, and is considered relatively inefficient. Also, system losses in transmission and distribution represent 23% of total output.

Potential for Renewable Energy:

Jamaica has abundant potential for the development of its renewable energy resources, including wind, biomass, mini-hydro, photovoltaic and solar energy.  In addition, the potential for the conversion of waste to energy, ocean thermal technologies and bio-fuels is being explored. Strategic analyses of renewable energy potentials on the island have identified a pipeline of projects for the electricity and transport sectors, which have the potential to reduce petroleum imports by over 10% by the year 2010. 
 
Hydropower 
The JPS owns eight hydro-generating units in various parts of the island with a total generating capacity of 23.8 MW and an additional installed potential of 100 MW. JPSCo at present uses the 24 MW of small hydropower as part of its base load capacity. Most of the plants, however, are fairly old and are at present undergoing rehabilitation; the oldest having been commissioned in 1945. 
 
Solar energy 
Jamaica has a high solar radiation of approximately 5kWh/m2 per day, or 1,800kWh/m2 per annum, and has market potential for photovoltaic and other solar applications such as solar water heating, electricity generation and solar crop drying. 
 
Wind energy 
In 2004, a 20.7-MW wind farm consisting of twenty-three 900-KW wind turbines was erected in Wigton, Manchester. In 2011 Jamaica the government announced the official commissioning of Wigton Two – an 18 MW, US$48 million expansion to its existing Wigton Windfarm. 
 
The expansion brings the total installed wind power capacity at Wigton to 38 MW. 
 
Biomass energy 
The dependence on world oil prices has prompted the government to plan for alternative thermal sources such as biomass cogeneration technologies using agricultural waste from sugar production. Many of the sugar factories use most of the bagasse they generate in the juice extraction process, but where there are surpluses, the sugar industry has planned future alternative uses for it, in an effort to reduce the volume of waste products that have to be disposed of. Over the past several years, the MME has reported in its Annual Report that the use of bagasse in Jamaica is consistently in the region of 1.2 million barrels fuel oil equivalent (bfoe). 
 
Biofuels 
The government, with the assistance of the Brazilians, has already embarked on a massive drive to develop an ethanol industry from sugar cane. The state-owned refinery, Petrojam, has partnered with Brazil's Coimex Group to rehabilitate a 40-million gallon ethanol plant that has already generated revenues of US$120 million from exports to the United States since 2005.  The Brazilian company Coimex will own 51% of the dehydration facility located in Kingston, while the Jamaican Government will own the remaining 49%. Initially, Jamaica will import sugar cane from Brazil until domestic production is viable.

Potential for Energy Efficiency:

A matter of concern is the country’s inefficiency in the use of energy with an energy intensity index that is more than four times the global average, due in part to the high energy use of the bauxite and alumina sector, an inefficient public electricity system, as well as inefficient energy technologies in manufacturing and other productive sectors. 
 
The Petrol Corporation of Jamaica continues its initiatives in mounting schools, community and public education programmes, designed to promote behavioural shifts to more efficient consumption and conservation of energy. These include a schools’ education project for stimulating a shift in domestic consumption patterns, and the offer, at discounted prices, of fluorescent energy saving bulbs to replace incandescent bulbs in homes. 
 
The implementation of large scale energy efficiency and conservation projects, under the Public Sector Energy Efficiency Project in hospitals and schools, to include conversion to solar energy for water heating and steam generation is at Phase One. Energy audits being carried out in all hospitals and some schools to ensure better use and management of energy will be completed in Phase Two. 
<a href="http://www.pcj.com/pdf/PCJ%20ANNUAL%20REPORT%20-%20FULL.pdf">http://www.... />
 
Industry
<ul>
<li>
Targeted efficiency improvements, and the introduction of CHP systems to the bauxite/ alumina refineries, as well as in electricity generation.</li>
</ul>

Utilities
<ul>
<li>
Promotion of public-private partnerships for monitoring of the energy sector, through capacity-building in the Ministry of Energy and Mining.</li>
<li>
Energy Security and Efficiency Enhancement project funded by the World Bank, via a US$15 million loan.</li>
</ul>

Transport
<ul>
<li>
DSM measures, including increasing the use of sustainable fuels (ethanol blends E-10, biodiesel), efficiency in vehicles, better infrastructure and the promotion of mass transit usage.</li>
</ul>

Residential
<ul>
<li>
Expansion of the standards & labelling capability of the Bureau of Standards.</li>
<li>
Develop a EE market, promoting EE in design through the introduction of Building Codes, EE appliances, and end-use equipment and incentives.</li>
</ul>

Public
<ul>
<li>
Awareness-raising in public sector end-users.</li>
<li>
Design of incentive mechanisms for EE in the public sector, through IDB investment.</li>
<li>
Energy auditing and cost-benefit analysis of EE equipment retrofitting for public buildings.</li>
</ul>

Ownership:

The Jamaica Public Service Company (JPSCo) is a vertical integrated utility 80% owned by U.S. based investor. The government of Jamaica and a small group of minority shareholders own the remaining shares. 
 
The generation side of electricity was fully liberalized in 2004. JPSCo provides 60% of all electricity consumed on the island.  Private companies generate the remaining electricity supply.

Structure / extent of competition:

Electricity market 
Jamaica Public Service Company (JPS) is the sole distributor of electricity. 
Rural Electrification Programme 
 
Oil market 
The Petroleum Corporation of Jamaica (PCJ) Development of Energy Resources, gas and Oil Exploration, Petroleum Refinery Haulage, Storage and Distribution. 
Petroleum Company Of Jamaica: Petroleum, Service Stations, Liquid Petroleum Gas (LPG) 
Petrojam Limited: Petroleum Refinery - LPG, Gasoline, Kerosene, Turbo Fuels, Auto Diesel, Fuel Oil and Asphalt 
 
Renewable energy market 
Petrojam/Ethanol Company Limited. Subject Matter: Alcohols, Ethanol 
 
Wigton Windfarm Limited

Existence of an energy framework and programmes to promote sustainable energy:

The Jamaica’s Energy Policy Framework 2009-2030 objective is to ensure that by 2030 Jamaica achieves a modern, efficient, diversified and environmentally sustainable energy sector providing affordable and accessible energy supplies with long-term energy security and supported by informed public behaviour on energy issues and an appropriate policy, regulatory and institutional framework 
The policy document represents the revision to the Energy Policy Green Paper 2006-2020 based on national consultations and comments received by a wide cross-section of society as well as current realities facing Jamaica; and in keeping with the country’s long term plan to achieve developed country status by 2030 as articulated in Vision 2030 Jamaica – National Development Plan. 
The policy presents seven goals: 
1. Security of Energy Supply through diversification of fuels as well as development of renewables 
2. Modernizing the country’s energy infrastructure 
3. Development of renewable energy sources such as solar and hydro 
4. Energy conservation and efficiency 
5. Development of a comprehensive governance/regulatory framework 
6. Enabling government ministries, departments  and agencies to be model/leader for the rest of society in terms of energy management 
7. Eco-efficiency in industries 
 
Energy Security and Efficiency Enhancement Project: The Jamaican Energy Security and Efficiency Enhancement Project  is designed to provide a comprehensive support to the implementation of the Government of Jamaica’s (GoJ’s) energy policy and strategy covering the 2010-2030 period. 
- Environmental Management Framework (EMF): The purpose of the EMF is to manage the potential adverse impacts by establishing a guide consisting of a set of methodologies, procedures and measures to facilitate adequate environmental management, including risk management and environmental impacts, directed to the group of works to be financed with the Project and whose specific location is unknown and may change over Project implementation. 
- Involuntary Resettlement Policy Framework (IRPF): The purpose of the IRPF is to define resettlement principles, institutional arrangements, and criteria procedures to be applied to sub-projects to be prepared during Project implementation. The IRPF aims to mitigate and minimize the impact on third parties who are affected by resettlement and the loss of  land and  private assets due to investments funded by the Project and whose specific location is unknown and may change over the Project’s implementation.   
 
Energy Green Policy (The origins of the Energy Policy Framework 2009-2030) 
- Energy policy green paper (October 21, 2009) 
- Energy policy green paper (June 24, 2009) 
- Energy policy green paper  (March 2006) 
  
Energy Policy Addendum 
- National Renewable Energy Policy - 2010-2030 (draft) designed to achieve a well-developed, vibrant and diversified renewable energy sector that contributes to Jamaica’s energy security and a sustainable future. 
- National Energy-from-Waste Policy - 2010 – 2030 designed to ensure that Jamaica is the regional leader in providing affordable and clean energy from waste contributing to a sustainable future. 
- Energy Conservation and Efficiency Policy will facilitate the engagement of all sectors of the economy and all persons in the society in a coordinated and aggressive drive towards significantly reducing national energy consumption. 
- Biofuels Policy is designed to achieve a modern, efficient, diversified and environmentally sustainable biofuels sector that contributes to Jamaica’s long-term energy security and socio-economic development. 
- Trading of Carbon Credits Policy designed to achieve a competitive, diversified, efficient and investment-conducive carbon credits trading sector that fosters socio-economic development and induces a less carbon-intensive economy. 
 
Jamaica’s renewable energy share currently stands at 7% of the energy mix.

Current energy debates or legislation:

Since 2005, Jamaica has embarked upon the preparation of a 25-year National Development Plan called “Vision 2030” which is expected to put the country in a path to achieve developed country status by 2030.  One of the expected outcomes of the plan is the diversification of Jamaica’s energy supply to increase energy security and to contribute to the cost efficiency of the country’s energy sector. Diversification will employ two components: diversification of the fuel mix, and diversification of fuel sources.

Major energy studies:

N/A

Role of government:

The Ministry of Energy and Mining mission is: 
To ensure Jamaica’s access to and affordability of energy supplies, energy security and the diversification, development and competitiveness of both the energy sector and the minerals sector for sustainable national development. 
 
The key functions of the Ministry are to: 
- Provide the policy framework and strategic direction for the operations of Divisions, Agencies and Departments. 
- Collaborate on the promulgation and amendment of legislation and regulations which guide the operations of its Agencies and Departments. 
- Set priorities and allocate financial and other resources, as appropriate. 
 
The Energy Division of the Ministry oversees the functioning of the energy sector. It monitors energy supplies and the identification alternative energy sources, as well as energy conservation. The Division works with: 
- The Petroleum Corporation of Jamaica (PCJ) in relation to petroleum and petroleum products. 
- The Jamaica Public Service Company Limited (JPSCo) in connection with light and power.  
 
The Energy Division is involved with energy-related policy-making and policy implementation

Government agencies in sustainable energy:

The Centre of Excellence for Renewable Energy (CERE) is a division within the PCJ, which was established in November 2006 to ensure that Jamaica will regularly implement new ideas and methods in renewable energy, in recognition of our excellent and abundant supply of natural resources.

Energy planning procedures:

N/A

Energy regulator Date of creation:

The Office of Utilities Regulation (OUR), the independent regulatory agency with responsibility for the electricity sector. It has been created in 1995. 
<a href="http://www.our.org.jm/">http://www.our.org.jm/</a>

Degree of independence:

The Office consists of a Director General and at least two Deputy Directors General. The Director General of the Office is selected by the Governor General of Jamaica while the Deputy Directors are selected by the Prime Minister.  Under the law all officials are appointed for a minimum of 3 years and a maximum of 7 years.

Regulatory framework for sustainable energy:

N/A

Regulatory roles:

The OUR was established by the Office of Utilities Regulation Act of 1995 to regulate the utility companies. Its objectives are to: 
 
- Establish and maintain transparent, consistent and objective rules for the regulation of utility service providers. 
- Promote the long term, efficient provision of utility services for national development consistent with Government policy. 
- Provide an avenue of appeal for consumers in their relationship with the utility service providers. 
- Work with other related agencies in the promotion of a sustainable environment. 
 
The OUR processes all applications for licenses to provide utility services and makes recommendations to the Minister in relation to the applications. If a utility is not fulfilling its contractual obligations, the OUR may require the utility to take remedial measures. The OUR may prescribe the rates charged by a utility for its services. 
 
The Office regulates the final price of electricity through provisions contained in the license issued to the Jamaica Public Service Company. It does not regulate intermediate transmission or distribution charges.

Role of government department in energy regulation:

The Ministry of Energy has general responsibility for policy formulations and review, energy planning, monitoring and research among other things.  With the emphasis on ECE (Energy Conservation and Efficiency), the role of the Ministry is expanded to: 
- develop key indicators to measure the impact of ECE initiatives 
- assess and monitor the effectiveness of approved ECE measures for periodic policy review 
- design and promote timely public awareness messages according to energy consumption trends and 
- undertake economic analysis, modelling and forecasting energy demand for the transport and electricity sectors.

Regulatory barriers:

N/A

References:

Nexant, for the World Bank. Caribbean Regional Electricity Generation, Interconnection and Fuels Supply Strategy. Final Report March 2010. Available at: <a href="http://www.caricom.org/jsp/community_organs/energy_programme/electricity... [Accessed 18th September 2013] 
 
Government of Jamaica. Jamaica's National Energy Policy 2009-2030. 21 October 2009. Available at: <a href="http://www.men.gov.jm/PDF_Files/Energy_Policy/Energy%20Policy%20-%20Octo... 18th September 2013] 
 
Ministry of Science, Technology, Energy and Mining. <a href="http://www.men.gov.jm/men.htm">http://www.men.gov.jm/men.htm</a> [Accessed 18th September 2013] 
 
Office of Utilities Regulation. <a href="http://www.our.org.jm/">http://www.our.org.jm/</a> [Accessed 18th September 2013] 
 
Jamaica Public Service Company Limited. <a href="http://www.jpsco.com/">http://www.jpsco.com/</a> [Accessed 18th September 2013] 
 
Petroleum Corporation of Jamaica. <a href="http://www.pcj.com/">http://www.pcj.com/</a> [Accessed 18th September 2013]

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