Opportunities Open Up for U.S. Businesses and the Caribbean’s Energy Sector

0
13

JamaicaThe U.S. Department of Energy and Jamaica’s Ministry of Science, Technology, Energy, and Mining signed a statement of intent in Jamaica today to advance their shared interest in sustainable energy. Areas of potential cooperation between the two countries include energy conservation and efficiency, energy infrastructure, micro grids and energy storage, fuel diversification, and energy policy.

President Obama also announced in Jamaica the formation of a fund to mobilize private investment in clean energy projects in the wider Caribbean and in Central America. 

The statement of intent and formation of the new fund coincide with President Obama’s visit to the Caribbean island en route to the April 10-11 Summit of the Americas in Panama, and is in keeping with his administration’s effort to deepen U.S. engagement in the region’s energy sector. Many see that effort partly as an attempt to counter the incursion of Venezuelan oil and Chinese infrastructure financing in the Caribbean and Central America.

Indeed, President Obama’s actions, including his talks this week with Jamaican Prime Minister Portia Simpson Miller and Caribbean leaders in a U.S.-Caribbean Community (Caricom) Summit in Kingston, Jamaica’s capital, create myriad opportunities for U.S. businesses in the region’s energy sector. While today’s discussions ranged from trade and investment linkages to security cooperation, they focused primarily on the importance of improving energy security, reducing energy costs, and fighting climate change.

“This region has some of the highest energy costs in the world. Caribbean countries are particularly vulnerable to the effects of climate change, and we have to act now. This is an example of how large countries and small countries have to work together, because without collective action, we’re not going to be able to address these challenges,” President Obama said to his Caricom counterparts. 

The Obama administration’s engagement on these issues has been robust over the last year, including the White House Caribbean Energy Security Summit hosted by Vice President Joe Biden in January 2015 and the launch of the Caribbean Energy Security Initiative coordinated by the Department of State. Other administration initiatives include:

* A $20 million Clean Energy Finance Facility for the Caribbean and Central American (CEFF-CCA) to encourage investment in clean energy projects. The facility will provide early-stage funding to catalyze greater private and public sector investment in clean energy projects.  It will draw on the expertise of the U.S. Overseas Private Investment Corporation (OPIC) and the U.S. Trade and Development Agency (USTDA) in coordination with the U.S. Agency for International Development (USAID) and the Department of State. 

* An Energy Security Task Force in which the United States will partner with Caribbean and Central American countries to evaluate progress in their cooperation and identify concrete steps to advance energy sector reform, regional integration, and clean energy development. 

* Clean energy finance.
In January, OPIC formed a dedicated financing and insurance team to advance development of the Caribbean renewable energy sector. OPIC is in advanced talks to finance a 20-megawatt solar farm in Jamaica, and has already committed financing to Jamaica’s largest private-sector wind farm, a 36 MW facility in Malvern, St. Elizabeth Parish. OPIC is actively looking for opportunities to support solar and wind energy projects in Jamaica and throughout the broader Caribbean region.

* Clean energy economy transition.
The U.S. Energy Department assembled U.S. and Caribbean working groups to look at opportunities ranging from clean energy, efficiency, diversifying electricity generation, clean transportation and energy education, at the Caribbean Clean Energy Technology Symposium, held in St. Thomas, the U.S.Virgin Islands, in March. The working groups will report on progress at the 2016 Symposium to be hosted by Jamaica. The department also will launch an Energy Scenario Planning Tool¸ building on its Energy Transitions: Island Playbook, to help island communities plan clean energy projects that are most likely to attract investment, capitalize on local resources, and meet energy needs. 

* Greening tourism. The tourism industry is the largest energy user in the Caribbean. The Department of Energy, with its Pacific Northwest National Laboratory, and OPIC are undertaking the Caribbean Hotel Energy Efficiency and Renewables (CHEER) initiative, which supports projects to improve energy and water efficiency as well as the exchange of best practices in the hotel and tourism industry.  USAID is launching a complementary project focused on the Eastern Caribbean that will develop new financing tools for energy efficiency and renewables.
 
* A Jamaica Clean Energy Program. USAID is working with the Jamaican government and the private sector on a new integrated Clean Energy Program to establish the pre-conditions for clean energy development, optimize renewable energy integration, and accelerate private-sector clean energy investment.