WASHINGTON, DC – Jamaica’s Prime Minister, Portia Simpson Miller has commended the United States Overseas Private Investment Corporation (OPIC) for its financing of an investment of US$90 million in a clean energy project in Jamaica as one of the first investments from a new US$700 million OPIC fund to encourage clean energy. The Jamaican project – Blue Mountain Renewables – will see a 34 megawatt wind facility built and operated in Jamaica by BMR Limited. Construction is expected to start in June this year.
Prime Minister Simpson Miller’s commendation came as she spoke at the Caribbean Energy Security Summit at the US State Department in Washington D.C., on Monday (January 26). The announcement of the OPIC fund and the Jamaican investment was made by US Vice President Joseph Biden, who chaired the Summit meeting of Caribbean Heads of Government, senior US and Caribbean government officials and the leadership of international financial institutions.
In her intervention at the summit, Prime Minister Simpson Miller pointed to Jamaica’s ongoing efforts to respond to its serious energy challenges. This, she noted includes the diversification of the fuel used to produce electricity and industrial steam power and increasing the use of renewables in the country’s energy mix primarily from wind and solar. Jamaica is also increasing the efficiency of the generation, transmission and distribution of electricity, through, among other things, the replacement of outmoded units and the modernisation of others, the Prime Minister said. She added that the Jamaican Government is promoting conservation in the use of energy in homes, offices, factories, farms and transport.
“Before the recent reductions in oil prices, energy represented more than one-third of our total import bill, accounting for more than 125 per cent of our total merchandise exports,” Prime Minister Simpson Miller outlined.
She added that the adverse impacts of high oil prices have been felt throughout the economy – constraining foreign exchange reserves and causing a lag in the competitiveness of major, energy-intensive industries such as bauxite and alumina, which is the largest industrial activity in the country requiring both electricity and steam for its operations.
“In respect of the mining sector, there has been the closure of two million tonnes of annual alumina capacity since 2009 as a direct result of the high cost of energy. This is equivalent to US $700 million of gross annual export earnings,” Prime Minister Simpson Miller reported, adding that: “With the money spent on electricity, petrol and liquefied petroleum gas for cooking, the disposable incomes of individuals and businesses have been suppressed. This, in turn, adversely affects local economic activities as people simply have less money to spend on both locally produced goods and services and imports.”
The Prime Minister acknowledged the assistance extended to Jamaica over the past 30 years from concessionary facilities – the San Jose Accord, by Venezuela and Mexico; The Energy Accord of Caracas by Venezuela; and PETROCARIBE, also by Venezuela. Even with this assistance, she noted, the price of oil has remained a burden on the Jamaican economy and these challenges will remain whether oil prices remain at or near the current levels.
