MAKING EVERY EFFORT TO LOOK INTO THE PRESENT

The importance of geothermal energy to the Eastern Caribbean’s energy future came into sharp focus last week. 

In a March 22nd press release, West Indies Power, the private developer of the Eastern Caribbean’s first geothermal power project (being implemented on the tiny island of Nevis) announced that Scotiabank had signed on to finance the project, to the tune of US$30 million.

It was a remarkable announcement. A commercial bank? Financing a large renewable energy project? In the Caribbean?

What the seemingly amazing news proves is that renewable energy in the Caribbean is bankable on a commercial basis – and that geothermal is the game-changer in the Eastern Caribbean region. So essentially, St Kitts & Nevis will soon join the ranks of the few truly green, low-carbon countries in the world.

Congratulations to Nevis are in order – and, from the regional perspective, a few comments.

The first is that, in terms of geothermal energy potential, there’s nothing special about Nevis; the Lesser Antilles chain of volcanic islands has long been considered to have large geothermal energy resources. The US-based Geothermal Energy Association (GEA) in 1999 reported that there were 39 countries in the world that “could be 100% geothermal powered”. The eight Caribbean countries on that list are (in alphabetical order) Dominica, Grenada, Guadeloupe, Martinique, Montserrat, St Kitts & Nevis, St Lucia and St Vincent & the Grenadines.

Gerald W Huttrer, a respected authority on geothermal energy (and one of the references for the GEA report) has ranked the islands in order of their geothermal development potential. Nevis is at number 5 – below St Vincent & the Grenadines (which is number 4) and St Lucia (number 2). Guadeloupe, ranked at number 1, already has 15 MW of geothermal power in operation, with plans to increase this to 47 MW by 2020.

But Nevis has come from behind to win the Eastern Caribbean countries race. The Nevis Island Administration first signed a memorandum of understanding with their developer in 2007 and exploratory drilling started in January 2008. By October of that year the geothermal resource had been proven and today – three years after the process started – construction of a 10 MW geothermal power plant on Nevis is about to commence.

The Dominica government has been aggressively pursuing its geothermal agenda, with two exploratory drilling projects in progress, one of which, in November 2009, delivered proof of large geothermal resources. But, despite having signed agreements at the same time as (or even before) Nevis, St Lucia and St Vincent & The Grenadines are still in the locker room; exploratory drilling has not even started on either island.

So here’s the summary of the situation. After decades of preliminary study and some recent specific explorations, it is now fairly clear that the region is sitting on potentially large geothermal resources. If proven, they will be more than sufficient to supply present and foreseeable demand for electricity on the respective islands. Add to this the fact that most of the fuel these islands import is used by vehicles, and the full implications of the story become clear.

Geothermal energy provides the prospect that, if we move to transition our light-duty vehicle fleets to hybrid and electric vehicles, we can replace almost all of our total fossil fuel imports with a green, indigenous energy source. This will eventually happen on St Kitts & Nevis.

The transport sector transition is already happening elsewhere according to Matthew Savage, a director of UK-based Oxford Consulting Partners, an energy, climate change and sustainability firm. At an energy policy workshop in St Lucia last week, Mr Savage opined that, by 2020, he would not be able to buy a gasoline or diesel-powered car from a mainstream car dealer in the UK. By then, he thinks, such cars will be manufactured on an ever-dwindling scale, replaced by hybrid and pure-electric vehicles.

This scenario represents a business opportunity that Caribbean oil companies should now be seriously examining. Their customers in St Kitts & Nevis will soon have the option to buy cars that fill up with electricity, even as some of our governments carry on with business-as-usual while continuing to “make every effort” to “look into” renewables.

IT'S QUICK! IT'S NIMBLE! IT'S... NEVIS!

In July 2009, the Nevis Island Administration authorized Canadian developer Windwatt Power Ltd to proceed with plans to develop wind power on Nevis. Barely six months later, the developer is constructing the first phase of a planned 4.4 MW wind farm that will provide green electricity to the island.

The work now in progress, to erect 4 Vergnet GEV MP 275 kW collapsible wind turbines (like the ones on Guadeloupe), will install 1.1 MW of wind capacity and is scheduled for completion in June 2010. The developers have plans for an additional 3.3 MW to be installed in phase 2.

This comes hard on the heels of the Nevis geothermal project which, in its first phase, is intended to construct an 11 MW geothermal power plant on Nevis.

So all told, in the past two years Nevis has approved and commenced implementation of two large green energy projects with a total (phase 1) installed capacity of about 12 MW - which is 2 MW more than the current peak demand on the island!

On the face of it, this is remarkable progress – and it far exceeds what the other Eastern Caribbean countries have achieved in renewable energy (which, in most cases, has been nothing).

Nevis’ managers are justly proud of themselves. During a field visit in February to the Windwatt site at Maddens Estate, Carlisle Powell, the junior minister for natural resources and the environment in the Nevis Island Administration, noted that there has been “a tremendous amount of talk from St Lucia, St Vincent, and from St Kitts even, where they are planning an 8 megawatt wind farm but to the best of my knowledge there is none which has actually started. In Nevis we have done more than start – we have the equipment on site, we have laid out the site already, so we are on the way”.

Well said, Mr Minister.

A BRIEF YEAR-END ROUNDUP

A brief (and personal) review of a few things that happened in 2009 and a preview of 2010

Renewable energy in the Caribbean

One word: geothermal. It’s the game-changer in the Eastern Caribbean, but only a couple of our countries appear to have seriously recognized this. Those that have, are now well on their way to developing truly sustainable and energy-independent futures. Others are trying to catch up, and yet others are still at the lip-service, do-nothing stage of the game.

First out of the blocks was Nevis. Having started explorations in January 2008, their geothermal project achieved critical milestones during 2009 (proving significant energy potential and signing of a power purchase agreement with the local electric utility). The project developer is now scheduled to commence drilling of production wells in first quarter 2010. This will be followed by commencement of construction on the proposed 11 MW geothermal power plant, which will supply baseload power to the Nevis Electricity Company (whose 2009 peak demand was about 9 MW).

Dominica isn’t far behind – and they're dead serious about geothermal. The Dominica government commissioned two separate geothermal explorations on the island in 2008; so far one of these has (unsurprisingly) concluded that Dominica has the largest geothermal energy potential in the Caribbean. The next steps will be to perform exploratory drilling in specific locations in 2010, to prove the extent of the resource, and to inform the design of the power plant options, which vary from 2+15 MW to 4x30 MW. And that’s only one of Dominica’s geothermal projects.

The other countries? Let’s see what happens in 2010.

Copenhagen

Let’s file this under what didn’t happen. By most reports, the outcome of the climate change summit represented a failure of political will on the part of the leaders of the world’s two biggest polluters, and a few others. China appears to have been particularly intransigent and, some have claimed, largely responsible for the failure of the talks. And it seems a supreme irony that, just weeks after his administration officially declared greenhouse gases to be a public health hazard, President Obama was unable to make any significant pledge for America, the world’s largest per-capita culprit, to cut its emissions of the stuff. The question now is: how to recover and move on? Expect lots of debate (and finger-pointing) in 2010.

Smarter Energy

Energy efficiency became sexy in 2009; look for it to be taken seriously in some parts of the Caribbean in 2010. Its newfound status is partly propelled by the breathless reporting from the developed world about so-called ‘smart’ electricity metering (part of a larger approach to achieving the ‘smart grid’). More important is the growing realization that energy efficiency is truly the low-hanging fruit; the easiest and least costly way to deliver energy services. And, for Caribbean countries that are dependent on imported energy (ie: all except Trinidad & Tobago) the benefits are even greater.

Welectricity, an award-winning new service to be launched in first quarter 2010, is based on this realisation. With its innovative, behavior-based approach to the energy efficiency problem, Welectricity will help households to achieve positive energy efficiency outcomes. Watch this space (and get more information at www.welectricity.com).

Twitter

The surprise of the year. I started using twitter in January (my first tweet: “Finishing off a commentary for my website www.greenislandinc.com”). In less than 12 months, it had become my number one source of information on developments in renewable energy and energy efficiency.

When I started using the micro-blogging service, it was because I vaguely realized that I ‘had to’. According to what I had read, it was supposed to allow me to extend my marketing and advertising reach beyond my traditional sphere of connections, budget, and so on.

I’m not quite sure how the marketing and advertising bit has worked out yet. John Wanamaker, a US department store merchant, once famously said that “half the money I spend on advertising is wasted. The trouble is I don’t know which half.” That’s sort of how I feel about the time I’ve invested in twitter. But I do know that what I have gotten is a great and growing source of relevant and timely information and opinion that I didn’t previously have - all in one place. Priceless.

For more insight on the twitter phenomenon, read the June 2009 Time cover story (the opening sentence is spot on). Then follow me on twitter at http://twitter.com/hazbert

A LONG ROAD AHEAD

I was having a drink and a chat with a friend recently. We got to speaking about business and the subject eventually turned to energy in the Caribbean. Our discussion was interesting and wide-ranging (and, appropriately, fueled by ethanol in various concentrations).

I was taken aback when I realised that his opinion of geothermal energy in the Caribbean was that it was some sort of little pilot-project-type thing; essentially experimental in nature, and not to be taken seriously by serious people. At one point, he even used the phrase "fly-by-night".

He himself is a successful businessman and entrepreneur and, more to the point, was quite recently on the board of directors of one of our Caribbean electric utilities. I tried to convince him that he was wrong, but perhaps our consumption of biofuels had by then affected the cogency of my arguments, and I failed.

Thinking the episode over the following day, I realised I should not really have been surprised. After all, before I started focusing specifically on Caribbean renewable energy and sustainability issues a few years ago, I didn't know what the real situation was either.

During our discussion I had pointed out to him that Nevis is now on track to become the Caribbean's first green island, powered by geothermal energy. He was skeptical. One of his arguments was that he had never heard of Nevis as having any sort of geothermal potential.

Well, until just over a year ago, neither did I.

But never mind the inherent egocentricity of this argument (which I also failed to point out to him at the time, no doubt due to my biofuel-enhanced state), the discussion highlights a particular problem that is affecting the Caribbean, which is: that the state of information on Caribbean energy prospects and options - matters of critical national and regional importance - is abysmal.

Any discussion of issues that have the potential to impact the collective futures of nations requires an informed public. How do we make sound decisions about vital matters if we are not informed? Do we leave these decisions to our business and political leaders? Are they themselves sufficiently informed? Some of the evidence suggests not.

It’s clear to me that there's a long road ahead on this. Far more needs to be done by the various actors and leaders in this space. Paradoxically in this so-called information age, we are falling short in informing our public on energy issues.

HOT SPRINGS ETERNAL

I had the pleasure of visiting Dominica recently. En route from the airport to the capital Roseau, the signs of geothermal energy potential were everywhere – from the smell of sulphur on the rainforest air, to the sight of people bathing in hot springs along the way.

Hot spring at Wotten Waven area, Dominica
Photo: H Samuel

I’m told that the sparsely-populated, mountainous island, popularly known as “The Nature Isle” has at least 9 active volcanic areas and too many hot springs to keep track of. So it should seem to be a natural for the exploitation of geothermal energy.

Geothermal is the most important prospect for renewable energy in the Caribbean, for two reasons: First, it represents baseload power – power that is constantly available at large scale, as opposed to solar and wind, which are intermittent resources and second, it is apparently widespread throughout the Caribbean.

The various studies that have been done of the geothermal potential of the Eastern Caribbean over the past two decades all basically say the same thing – that there appears to be significant geothermal potential in the region – and, crucially: that it appears to be far greater than present demand for electricity.

So if large geothermal resources are proven to be available on a few strategically-located islands (say Nevis in the north, Dominica in the middle and Grenada or St Vincent in the south), power can be made available via undersea transmission lines to the others, thereby creating an interconnected, renewable and sustainable electricity network spanning the Eastern Caribbean.

So (the inevitable question): why isn’t there more geothermal being used in the Caribbean? The region's only geothermal plant is in Guadeloupe, with an installed capacity of 15.5 MW, which is reported to provide close to 10% of Guadeloupe’s electricity demand.

As is the case with many RE technologies, a major issue is the up-front cost. Geothermal energy in particular is affected by this because, notwithstanding sulphurous valleys and hot springs: in order for a geothermal power plant to be built, specific explorations (geological, geochemical and geophysical studies, drilling a few holes through rock to depths of several thousand feet, etc.) must be carried out – and they are very expensive. For example; the recently-concluded exploration that established Nevis’ geothermal potential is reported by the developer to have cost US$8 million. The power plant construction is estimated at US$45 million, to install 11.6 MegaWatts of power, which can supply Nevis’ existing electricity demand (currently about 9 MW).

These costs sound high, but they actually represent an economic and environmental bargain (in a subsequent post, we’ll dig deeper into some details of the economics of geothermal vs diesel power on these islands).

The Nevis power plant construction is reported to be going ahead, so it looks as though Nevis will indeed become the Caribbean’s first green island. Meanwhile, Dominica is not far behind; there are two separate geothermal explorations proceeding on the island. One is funded by the European Union; the other is being carried out by the Nevis project developer. One or both of them could bear fruit; this would create the central point for geothermal electricity generation in the Eastern Caribbean. Then all we would need is another in the south and the foundation for the creation of an entire string of green islands would be in place.

Dominica’s geothermal explorations could be concluded by mid 2010, but significant hurdles exist. If her geothermal resources are proven, Dominica’s mountainous terrain will challenge the builders and increase the cost of building a power plant and the transmission lines required to get the power to end users. Then there are the technical, economic, business and political challenges of designing and building an interconnected Eastern Caribbean power grid.

But these challenges will pale in comparison to the legacy of failure we will leave if we continue a business-as-usual-with-a-few-incremental-improvements approach.

That time has passed.

More information on geothermal energy can be found here

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