Nevis Government aggressively pursuing geothermal development

Minister responsible for Renewable Energy and the Environment on Nevis Hon. Carlisle Powell

CHARLESTOWN NEVIS (November 10, 2010) — Minister responsible for Renewable Energy and the Environment on Nevis Hon. Carlisle Powell told a meeting of businessmen in Barbados recently that the Nevis Island Administration (NIA) was aggressively pursuing the development of geothermal energy.


The Minister, who was invited to deliver an address at the International Business Week Conference of the Barbados International Business Association (BIBA) in Barbados,    referred to the project as a test case for interconnection between St. Kitts and Nevis and then the wider region.


“This project is an important test case for large scale investment in the islands. I say this because the interconnection submarine cable between Nevis and Puerto Rico has been estimates at over US$500million. We are talking about major investment,” he told the businessmen.


Mr. Powell explained that even as Nevis explored the resource, two Nevisian engineers had already been exposed to training at the La Geo Geothermal Plant in El Salvador and one recently completed a Masters programme in Geothermal Reservoir Management at the United Nations University in Iceland while the other was expected to travel to Iceland shortly.


He also noted that in addition, two employees of the Nevis Electricity Services Company Ltd. would begin a geothermal training course in El Salvador in January 2011.


Meantime, while the Nevis minister addressed some of the key issues outlined in key documents involved in the renewable energy arrangements between the NIA and the renewable energy investors on Nevis.


“I should also tell you that in the Contract and Power Purchase Agreements, we negotiated terms that included Ownership by Nevis of 10 percent of the shares in the company; An option for Nevis to purchase a further 10 percent shares; Payment of taxes by the company; Royalty payments of 5 percent on domestic sales of energy and Royalty payment of 7 percent on regional sales,” he said.


Mr. Powell then invited the businessmen to approach investments in the area of green technology with open minds and urged them to examine the reality of power generation in Barbados and the wider Caribbean.


He pointed to interconnectivity as it existed in the United States of America, Canada and Europe and said the possibility existed for the Caribbean to follow. The Energy Minister said the islands had been operating independent grids which were expensive to build, costly to operate and a nightmare to maintain.


“All of them have redundancies. Think about the provinces in Canada, the different states in America and countries in Europe. One thing they have in common is interconnection. So New York purchases power from Toronto, Los Angeles from Phoenix and Germany from Austria. With the correct investment, Nevis, St. Kitts, Antigua, St. Maarten, Barbados, Trinidad, Puerto Rico, Santo Domingo could all be interconnected,” he said.


The Nevis Energy Minister referred to a recent World Bank study which he quoted as saying that customers in the Caribbean faced some of the highest electricity tariffs worldwide and their governments were increasingly concerned about the environmental burden of the current power generation, especially in tourist driven countries.


According to Mr. Powell, the Study further stated that there were alternatives to nearly exclusive use of diesel and heavy fuel oil for power generation. Liquefied Natural Gas (LNG), Compressed Natural Gas (CNG) and pipeline natural gas may be economically and financially viable.


“Development of submarine cable electrical interconnections among the countries would enable them to share lower cost resources, provide mutual support, gain economies of scale in power plants and systems and obtain the benefits of power pools generally,” Mr. Powell quoted the Study as saying.


He said further that the World Bank report on “Caribbean Regional Electricity Generation, Interconnection and Fuels Supply Strategy”, described interconnection between Nevis and St. Kitts 50MW, 5km, geothermal power export as highly economic and between Nevis and Puerto Rico, 400MW, 400km geothermal power export as highly economic if displaced fuel is heavy fuel oil. The report also referred to geothermal exports between other Caribbean islands.


Mr. Powell explained that investment opportunities would become available for funding and placement of the submarine cable that would connect the islands.


“There will be opportunities for maintenance of the cable. The cable route must be surveyed and the sea bed mapped. What about the possibility of laying communications cable with the power cable? This opens up the possibility of Broadband and greater bandwidth for the first world communication for our business and people,” the Nevis Minister said.
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