Caribbean Countries Told to Avoid Duplicating Mistakes in Geothermal Sector

By Desmond Brown

FORT-DE-FRANCE, Martinique, Jun 23 2015 CNS – A senior official of the World Bank says Caribbean countries should learn from each other in a bid to avoid duplicating mistakes as they pursue efforts to develop their geothermal sector.

Senior Energy Specialist at the World Bank, Migara Jaywardena, said one of the most important lessons for regional countries is that they should do whatever they can to attract good developers who are reputable, experienced and have the capacity to mobilise financing.

“I think, in the Caribbean, there are examples that you can easily find where developments have moved forward and developments that have gotten stuck in many cases,” Jaywardena told Caribbean News Service (CNS) on the sidelines of the Martinique Conference on Island Energy Transitions.

“The developer that you end up working with makes a big difference. But you also want to select in an open and transparent way as well.

“It’s still challenging in the small islands where you are developing something for the first time. The risks go all the way through – not just at the resource level – but they’re making a very strong effort to close the deal and get things moving,” he added

Jaywardena said the June 22-24 conference here, organised by the International Renewable Energy Agency (IRENA), is very useful and comes at the most opportune time when the region is preparing to join countries from around the world for the 21st meeting of the United Nations Conference of the Parties, also known as COP21.

Pointing to Dominica as an example, the World Bank official said geothermal energy “could be a complete game changer” for the country if a proposed export project works, “because (geothermal energy is) basically an export commodity now”.

With assistance from the European Investment Bank, the European Union’s long-term lending institution, which provided a EURO1.1 million (One EURO=US$1.29 cents) grant, Dominica has conducted detailed planning and studied the feasibility of exporting electricity generated by geothermal energy to neighbouring Martinique and Guadeloupe.

Dominica’s Minister for Trade, Energy and Employment, Ian Douglas said  when the project was first conceived, there were other partners like St. Lucia and St. Kitts & Nevis, but it has since been narrowed down to mainly Dominica, Martinique and Guadeloupe.

Dominica has successfully drilled test wells, production wells and a re-injection well, and is focusing on the sensitisation of the public about the project and its implications.

Dominica will first seek to build a small plant capable of generating six to eight megawatts of electricity, with the hope of expanding to a much larger plant, with up to 120 megawatts, to supply neighboring Guadeloupe and Martinique.

“The small plant has two purposes. The production of electricity in Dominica [and] act as a pilot project so that the experiences from its development will serve us well in the development of the larger plant,” Douglas said.

To date over more than US$54 million has been spent on the exploration of geothermal energy in Dominica.

Jaywardena said to the extent that Dominica can reduce and stabilise electricity prices domestically, that would be a big help for the economy there.

“We have been providing Dominica with technical assistance for a couple of years along with some other development partners as well and now we’re in the process of looking at the financing of the final stage  so that would be the first next generation geothermal power plant since Guadeloupe that would come online,” the World Bank official said.

Jaywardena said the World Bank has also had discussions with other countries in the region.

“We’ve had discussions with Grenada, St. Kitts and Nevis, St. Vincent and St. Lucia where we have two formal activities. In St. Lucia, we’re supporting the government to do the surface level work so that they can make a well informed decision about whether they should move forward with exploration drilling or not,” he said.

“The challenge is to make sure that you really meet industry practice and international standards because if you do that, even the surface level work that you do significantly reduces the risk because then you can better target the drilling.”

It’s still challenging in the small islands where you are developing something for the first time. The risks go all the way through – not just at the resource level – but they’re making a very strong effort to close the deal and get things moving.

St. Vincent and the Grenadines as also announced the launch of a US$50-millionproject, funded by the Bill, Hillary & Chelsea Clinton Foundation, the St. Vincent and the Grenadines government, Barbados Light and Power Holdings and Reykjavik Geothermal.

A contingent of Icelandic scientists visited St. Vincent towards the end of 2013 to investigate its geothermal potential, estimated at 890 mw.

In January,  St. Vincent was granted a loan of US$15 million to help fund the development of a 10 to 15 megawatt geothermal project, expected to come on stream by 2018.

The funds are part of US$57 million in concessional loans for five renewable energy projects in developing countries financed under the second cycle of IRENA and the Abu Dhabi Fund for Development (ADFD)