EDITORIAL - What about energy conservation?

The price of oil may have receded slightly yesterday on the disclosure that OPEC members might pump more to ease the shortfall in the market because of the crisis in Libya. Crude, however, remained comfortably over the US$100 mark.

That is not good news for Jamaica, whose economic calculations are predicated on a price for crude below that range. For high prices could undermine the modest two per cent growth target in the coming fiscal year, after the negative performance of the past three.

But matters could grow worse.

Libya is in the early stages of a civil war which could lead, as seems likely, to the fragmentation of the country and the removal, for a long time, of the more than 1.5 million barrels of oil per day that it supplies to the world market.

It is in that context, and the wider unrest in the Arab world, that some analysts have begun to more than whisper about the prospects of US$200 oil.

It may not come to that. However, even the current trends have begun to concentrate minds in most major economies concerned that the recovery from which they are emerging after the global recession could be stymied.

Unfortunately, we do not sense the same concerns in Jamaica. If there are, they have not been coherently articulated and verbalised by the country's key policymakers.

We will, perhaps, be pointed to the Government's energy policy, which commits Jamaica to convert from oil to natural gas as its primary fuel source to drive the economy into the future.

Unfortunately, our Government - notwithstanding that undertaking, its request for bids for 480 megawatts of gas-fired electricity generation and naming a preferred bidder for a liquefied natural gas storage and regasification facility - continues to decline to share with the public the economic basis on which it arrived at its decision. The public, in the circumstances, cannot be sure that this is the least-cost option for energy.

This matter is important.

Energy is more expensive in Jamaica than in most of its Caribbean Community partners and is a significant drag on the country's economic competitiveness. Moreover, energy is so important that the country's fuel choice should have broad national buy-in rather than being the result of an executive decision by a few members of the Government and select advisers.

No short-term solutions

But there are some more immediate concerns about the administration's energy-management agenda that raise questions about the vision and/or thoughtfulness of those with responsibility for that portfolio.

In the midst of the emerging crisis, we discern no ideas to have significant effect in the short term.

An ongoing energy-conservation campaign should be part of the programme of the energy ministry. In the current circumstance, any that may have lapsed should have been started, urging, for example, carpooling and the use of energy-saving lighting.

Or, the authorities might place on the agenda for rigorous debate the matter of daylight saving time that was introduced during the oil shocks of the 1970s but was abandoned in the 1980s.

In so far as there is energy conservation, it is largely the result of the pass-through effect of the price of oil that goes directly to the pockets of consumers.

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