Home' Trinidad and Tobago Guardian : March 20th 2014 Contents MARCH 2014 • WEEK THREE www.guardian.co.tt BUSINESS GUARDIAN
ENERGY | BG9
Caribbean countries could see significant
reduction in their electricity rates if they
embrace renewable energy, according to
Michael R Brower, president of the American
Council on Renewable Energy.
In an interview with the Business Guardian
at his office here in Washington DC, the head
of the United States leading lobby group for
renewable energy said the Caribbean had sig-
nificant potential for wind, wave and geot-
hermal energy. He said with wind energy now
being produced for as little as US$0.04 cents
per kilowatt hour, it made economic sense for
Caricom countries to go green since their elec-
tricity costs were, in some cases, as high as
US$0.50 cents per kilowatt hour.
"The Caribbean has tremendous potential.
We met with the ambassador for Grenada and
we were told that the electricity costs there
exceeded US$0.50 cents per kilowatt hour. I
mean, that is crazy. We are producing electricity
from wind for as low as US$0.04 cents, so it
makes perfect economic sense," Brower told
the Business Guardian.
Brower acknowledged that the Caribbean
countries had a specific challenge in terms of
the size of their population and the upfront
cost required to invest in renewable energy,
but said there are ways to finance such proj-
"I know there is an issue of where the money
will come from. Well, there are many oppor-
tunities with smaller private overseas insti-
tutions prepared to fund it in the Caribbean.
In fact, we are having a conference in Puerto
Rico that will address some of those con-
The Renewable Energy Latin America and
Caribbean Conference and Exhibition (RELAC-
Cx) conference will take place April 24-25 and
is expected to being together Caricom gov-
ernments, financiers and the private sector to
seek financing solutions to green projects in
Also sharing the view that renewable energy
is becoming less costly and will be able to
compete in price with traditional fossil fuels
is one of the world s largest defence contractors,
Lockheed Martin, headquartered in Bethesda,
Maryland, which has established a major busi-
ness in renewable energy.
Barri Gurau, the company s senior manager,
energy initiatives, said within three to five
years, geothermal energy will be able to com-
pete with the price of natural gas in the
She pointed to St Kitts and the significant
potential for geothermal energy. She said many
of the company s 60,000 scientists and engi-
neers were working on the renewable sector
because they realise it is a national security
issue for the United States.
Lookheed Martin produced a map based on
its global modelling that showed what a rise
in ocean levels will mean for the Americas. It
showed that even a single metre rise could
lead to certain islands under water. In the case
of T&T, a five to six metre rise could result
Gurau said there will continue to be a need
for traditional fossil fuels because of the explo-
sion in the world s population, but ultimately
Lockheed Martin is convinced renewable ener-
gy will be the fastest growing energy in the
Gurau said the company had landed a con-
tract to retrofit one of the largest US embassies
in Latin America with solar power and it was
estimated to save US$36 million in electricity
The T&T Government has established a
renewable energy unit in the Ministry of Ener-
gy, but has so far concentrated on outfitting
schools and some government offices with
energy efficient bulbs and solar-powered light-
Renewable energy could
reduce region's energy rates
The director of the Mexico Institute at the Wilson Centre
think tank in Washington DC has predicted that petrochemical
plants at the Point Lisas Industrial Estate might return to their
major market in the United States where energy is cheaper.
In an interview here in Washington DC, Dr Duncan Wood,
one of the leading energy experts in Latin America and the
Caribbean, said business will always follow where it can get
the best deal.
"I know that T&T is the leading exporter of methanol in
the world and sells a huge amount of ammonia and urea to
this country, but the reality is that natural gas prices are now
about US$2.50 per mmbtu because of shale gas, and so I want
to say business and capital will follow where they can get the
best rate of return, and it is conceivable that we can see plants
moving North from T&T back to the United States."
The continued competitiveness of T&T s energy sector has
been talked about for a number of years now with the increased
costs to produce the gas by the upstream sector and concern
that the National Gas Company s (NGC) take as the middleman
may be too high.
Wood said while it was possible to see plants leaving Point
Lisas, doing so would depend on investors being comfortable
that the present low prices will remain over the long term.
He predicted that natural gas prices may average around US$4
per mmbtu to make it profitable for the gas producers. In
addition, there was a major concern about the length of time
it takes for regulatory approvals in the United States.
"Who wants an ammonia plant in their backyard? So the
regulatory issues are major and I will give you an example.
The tight oil in Pennsylvania extend all the way into New
York. It s the same play but there is drilling in Pennsylvania,
and so far, it is not being allowed in New York, so the challenge
is at both the federal and the state levels," Wood explained.
He predicted that crude prices could come down by as
much as US$20 a barrel if the United States lifts its moratorium
on the export of petroleum.
Wood said he was convinced the US government will lift
its moratorium on the export of crude.
"What we have seen over the last seven years is the phe-
nomenal rise of crude and gas production in North America.
I mean this year alone, the United States will add another
million barrel of oil per day, and on top of that, we see Mexico,
which is also an amazing story turning itself around, and
Canada continuing to be a leading producer of oil and gas.
So my sense is that this oil has to go somewhere and that the
US government will lift its moratorium, and we will see with
that a $20 drop in crude prices internationally."
If Wood is correct and crude prices fall by as much as US$20
a barrel, it is expected to have a significant impact on gov-
ernment revenues, which is heavily dependent on revenue
from the energy sector.
At present, the US government does not allow the export
of crude oil due to national security concerns, but does allow
the export of petroleum products, which has been hurting
Petrotrin because refineries in the US have been getting crude
at discounted prices at Cushing, and then making huge margins
on refined product. However, Petrotrin has had to pay regular
global prices and has been hurt by low margins, an ageing
plant and high overheads.
American energy expert predicts...
Pt Lisas plants likely to
return to United States
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