The state of Renewable Energy and Energy Efficiency in Saint Lucia

The current price of fossil fuel generated electrical energy in Saint Lucia is among the highest in the world, though not the highest in the OECS, as all the islands have a strong dependence on diesel derived electricity. These high prices have put a great deal of pressure on the government to develop and implement strategies that will result in a decrease in energy prices. Contrary to popular belief, the responsibility for reducing the high energy prices does not lie solely with the power company, LUCELEC.

There are several barriers to the immediate uptake and greater penetration of renewable energy technologies to our energy supply. Among these are

1. Legislative and regulatory barriers – In order to create an environment that is attractive to energy investors, the government must implement strong policies that support the integration of sustainable energy into the power grid and that provide investors with the confidence that they will have an acceptable rate of return on their investment. Saint Lucia implemented a National Energy Policy in 2010, which sets the backbone on which the required legislative framework can be built. Our current legislation must be reviewed to permit the operation of independent power producers and also oversight of the sector by an independent energy regulator.

2. Renewable Energy and Energy Efficiency Action Plan – The process of implementing elements of the National Energy Policy is usually embedded in an action plan that details activities, responsible agencies and a means of measuring success. Though specific actions are being pursued by the government in both RE and EE, no concrete action plan has been agreed to.

3. High cost of capital – A significant deterrent to investment in renewable energy technologies is the significant capital cost of such projects. Most energy suppliers for large grid connected projects source and provide their own capital, so that this barrier is removed through the use of private investment.

The current cost of generation of electricity from diesel fuel is in the range of US$0.18 to US$0.22 per kWh. The table below contains a summary of the levelised cost of energy (LCOE) from various renewable energy sources applicable to Saint Lucia (Latin America and the Caribbean region) according to the International Renewable Energy Association (IRENA):

2011 LCOE US$/kWh

Technology Upper Limit Lower Limit   Weighted Average

Off shore wind 0.18 0.05 0.09

Large Solar PV 0.31 0.11 0.15

Biomass 0.18 0.03 0.05

Small Hydro 0.11 0.02 0.05

Geothermal 0.06 0.04 0.05

Source: IRENA Document ‘Renewable Power Generation Costs in 2012: An Overview’

It is clear from the IRENA report that it is much cheaper, from the data sample used, to generate power from renewable energy sources than it is to do so from diesel. It follows then that a simple consideration of avoided cost of generation is not sufficient for setting tariffs for renewable energy as this method could very easily result in private investors making substantially excessive profits. This would be another unnecessary burden to the rate payer (i.e. the energy consumer).  The process of integrating more renewable energy into the power grid therefore, has to be approached with due caution.

There are however, projects that can be immediately undertaken on an individual basis to alleviate energy stresses. Three of the most feasible options are:

1. Residential and Commercial solar PV systems – LUCELEC currently allows grid connected residential PV systems up to a size of 5kWp and commercial PV systems up to a maximum size of 25kWp under a net metering arrangement. Under this arrangement, the customer directly uses the energy generated from the PV system and exports any excess generation to the power grid. The customer consumes from the power grid any deficit of energy that the system does not produce. Typical system prices and monthly energy production for 1 kWp, in Saint Lucia, range from US$3000 to US$4500 and around 125kWh. Prices for solar PV systems are constantly dropping.

Note: PV system sizes are given in kWp, i.e. kilowatt peak. This rating is generated under internationally agreed standard test conditions that differ from typical operating conditions. Output from PV systems varies depending on environmental conditions.

2. Farm scale biogas systems – The Inter American Institute for Cooperation on Agriculture, IICA, and the Energy Science and Technology, EST, section of the Ministry of Sustainable Development, Energy Science and Technology, are currently providing funded assistance for installation of biogas digesters on animal farms, especially pig farms. The generated biogas can be used by the farmer for cooking. The effluent from the biogas digester can be used by the farmer as fertilizer for his crops, or sold to other farmers. This is an active project and either agency can be immediately contacted for assistance.

3. Stand Alone Solar, Micro Hydro and Wind Systems – Currently, any private property owner is permitted to install a renewable energy generation system to meet his own needs. These systems will require battery storage to ensure a continuous energy supply. Support for correct sizing and design of these systems can be sourced through the EST section of the Ministry.

Funding for all renewable energy systems based on proven technologies is
currently available through
the Saint Lucia Development Bank and some commercial banks at reasonable
interest rates. A well developed proposal will be required in order to access the available funding.

All renewable energy systems are import duty free. Systems are still subject to the Value Added Tax (15%) and to a service charge (5%).  There is a suite of incentives currently being implemented for renewable energy systems, however, information is not yet available for release to the general public. Saint Lucia’s current building code was not formulated with energy efficiency as a requirement.

Thus, the island currently has no Minimum Energy Performance Standards for buildings. Adoption of such a standard would require that buildings meet a certain maximum energy consumption per square meter of floor space. This would encourage use of energy efficient building practices, such as use of cross ventilation, shading of windows exposed to direct sunlight, insulation of building walls, use of high efficiency air conditioning systems and high efficiency lighting, such as LED lighting.

There are pilot projects in the city of Castries demonstrating the use of efficient LED street lighting and LED office lighting as on the first floor of the Ministry of Infrastructure building located in Union. There currently exist duty free concessions for some energy efficient devices, including LED lights.  The Customs and Excise department can be consulted for a complete list of items.

Designers of new buildings are encouraged to consult the EST division for information on how to reduce the energy footprint of their designs. There are several regional projects targeted at energy efficiency in buildings. The results from these studies can be made available to help inform better decisions for reducing the energy consumption of new buildings. Existing buildings can be retrofitted with more energy efficient equipment, however, it must be noted that education is a very important factor for implementing any energy efficiency projects. The usage profile of equipment being upgraded must be considered as there have been cases where energy savings from installation of more efficient equipment have been offset by increased usage of the new equipment. This increase in usage may or may not be necessary, e.g. not turning off LED lights when a room is not in use because the lights consume less energy.

Experience has shown that investments in energy efficiency projects result in a payback period which can be in excess of twice as fast as for renewable energy investments. For instance, investments in LED lighting to replace incandescent bulbs can generally be shown to have a payback period of less than 2 years, whereas, residential scale solar PV systems have a payback period

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