Waves of change: Ocean renewables and solving rising electricity costs in Jamaica

Excessive electricity costs

Following the ferocious and deadly Hurricane Beryl in July, scores of Jamaicans expressed outrage at the massive increase in their electricity bills. They complained that the country’s lone electricity supplier, the Jamaica Public Service Company (JPS), had charged them too much. The minister in charge of energy, Daryl Vaz, had to take the matter to the independent watchdog, Office of Utilities Regulation (OUR), which recommended that customers who received estimated bills in July should pay 40 per cent less on their August bills.

Sasha Williams operates a bar in the Parish of Portland, on the eastern end of the island. She is among those affected by the high cost of electricity in Jamaica. “For years now I have been paying too much for electricity, and something needs to be done about it urgently. To make matters worse, I am a commercial customer as well, and we pay higher rates. The expensive light bills affect my business”, she complained.

Alternative energy sources

This was not the first time there had been such an outcry in Jamaica about the high cost of electricity. In fact, such occurrences are quite common, as Jamaica imports all the oil it uses for electricity and transportation. For years, the government has been looking for alternatives to help curb the very high energy cost. Much of the focus has been on clean energy like solar, but there has been a wave of change, as many people have been exploring using energy from the Caribbean Sea, which surrounds the island. Two such renewables are offshore wind farms and Ocean Thermal Energy Conversion (OTEC). Apart from lowering electricity costs, these ocean-based renewables seem to offer a stable homegrown solution for consumers with the bonus of contributing to environmental sustainability.

Offshore wind farms use turbines installed in an ocean or large lake where there is strong wind to generate electricity. The generated electricity is transmitted through underwater cables to onshore locations. Meanwhile, OTEC generates electricity by utilizing the temperature difference between the warm surface waters and the cold deep waters of the ocean. It is ideal for tropical regions, like the Caribbean, where the surface water can be significantly warmer than the deeper ocean layers, creating a thermal gradient.

Director of Engineering Services at the JPS Ricardo Case acknowledges that such ventures are very expensive. The government would need significant financial support from international agencies for such mammoth undertakings, which may not be the most feasible at this time, unless there is huge funding. He argues that offshore wind and wave energy will not reduce the cost of electricity in Jamaica in the short term because of the high setup cost. He also maintains that perhaps after 15 years, we may see some reduction in the cost once the investment is amortized.

Financing renewable energy

According to Case, “The Government of Jamaica can seek public-private partnerships investments or green funds climate resilient money to help with the project financing. Similarly, IPOs and floating bonds over 10 years should be able to help with the huge cost. The treatment of the high recurring maintenance cost would also need innovative financing as, initially or just after warranty is up, the project would not be able to generate sufficient revenue to keep up in a sustainable way”.

Duane Rowe, a certified energy risk professional and energy economist with experience in various international energy projects, echoed the sentiment that the high investment costs and the need for substantial funding could make these technologies prohibitively expensive in the near term. However, Rowe stated that if these projects receive adequate financing—such as through international grants—they could be worthwhile in the future.

Rowe pointed out that all technologies go through learning and experience curves and, as seen with other renewable energy sources like solar power, these technologies could eventually achieve grid parity. Learning and experience curves are based on the premise that the more you do something, the better you become at doing it. Therefore, as more of a particular technology is developed, its future investment and operating costs will decrease. Grid parity occurs when a renewable energy source can generate power at a cost equal to or lower than that of other sources on the grid.

Rowe highlighted that “the Europeans, such as the Germans, used to do significant large-scale wind and solar projects when they were expensive, which helped propel the technology cost reduction over time. Ocean-based energy technologies could follow a similar trajectory”, he commented, reiterating that these projects could be valuable in the long term with sufficient funding.

In Europe, renewables project development had, traditionally, been facilitated by feed-in tariffs, a policy incentive mechanism that incentivises these renewables’ production.
He, however, thinks the end game is solar, which, in his view, currently produces much more energy globally. He, however, does not rule out that one day, energy from ocean sources could play an increasing role in our grid. He pointed out that these renewables should be seen in a complementary light, and not as competitors.

Sasha Williams also supports the view that the time has come for the Jamaican government to seriously explore investing in renewables. “We need something different; the government needs to find solutions like getting electricity from the ocean. We don’t produce oil, and that’s the main reason electricity is so expensive. If more people were using other forms of energy, it would lessen the cost, and the bills would not be so high”, she noted.

Protecting investments from weather events

Another crucial factor is the protection of the investments from damage from hurricanes and storm surges. According to Case, the engineering design for hurricanes and extreme weather would have to factor all conditions and harden to protect against them. “Some things can be covered by design; others will need operational actions to secure the plant. Usually, the plants are taken offline and assets secured for high surges and winds; that may pertain here as well”, he said.

Regarding the impact on the environment, Rowe underscored that very careful environmental assessments should be carried out before such projects begin. However, he does not foresee any significant environmental and marine life damage. “I think it is possibly harmonious with the environment”, he argued.

Apart from the high fuel cost, Jamaica has been exploring ways to limit its use of fossil fuels, which increase greenhouse gas emissions and contribute to global warming. The Caribbean, highly vulnerable to climate change, urgently needs to transition to sustainable energy as frequent hurricanes, rising sea levels, and extreme weather threaten livelihoods and infrastructure. By shifting from fossil fuels to renewable energy sources like solar, wind, and ocean-based technologies, Caribbean countries could reduce their greenhouse gas emissions, enhance energy security, and build resilience against climate-related disasters. This transition not only mitigates environmental damage but also offers economic benefits through job creation and energy cost savings. It could also foster a more sustainable and secure future for the region.

This story was produced with the support of the Caribbean Energy Transition Media Mentorship by Climate Tracker Caribbean