Consumers to rake in benefits from EV expansion
Published:Monday | July 18, 2022 | 12:07 AMKimone Francis/Senior Staff Reporter
Senior executives of the country’s monopoly power distributor have downplayed potential earnings from the installation of electric-vehicle charging stations across Jamaica, noting instead that it is a “bullish” investment to bring down the cost of electricity.
Already, the Jamaica Public Service Company (JPS) has installed eight of 10 committed charging ports, and has indicated that the number may grow with the expectation of an increase in electric-vehicle imports.
However, President and CEO Michel Gantois told Thursday’s Gleaner Editors’ Forum that the company is not expected to make a “bonanza”, but could not disclose profit projections.
Gantois said, as a commercial company with private shareholders, decisions will centre on ensuring profit and financial stability for a strong balance sheet.
“But, apart from that, the vast majority of the benefit of additional demand coming from electric vehicles will go to customers in the form of reduced tariffs. There’s no other source of the dramatic increase in demand that we see in the country that can take that role,” the JPS boss said.
“We don’t think there will be a massive [industrialisation] or a massive increase in commercial activity in the country that can replace that potential increase in demand coming from electric vehicles,” he added.
In buttressing the point, Chief Financial Officer (CFO) Vernon Douglas said new industries are needed in the country to create greater economies of scale around electricity.
SMALL MARKET
Douglas noted that the island’s market for electricity remains very small in terms of the average kilowatt-hour consumption, and is only a fraction of what a customer consumes in the United States.
“You still have to have this massive infrastructure. That’s going to have a significant impact on cost. So, the more you can have new industries to share the same infrastructure, it dramatically puts a positive impact on the cost of electricity. So that’s why we’re bullish about it,” he said.
Douglas said innovation in equipment manufacturing has resulted in appliances being energy-efficient.
He said that this has caused a general trend of energy reduction taking place with the infrastructure for energy production remaining the same.
“You need something to take that gap,” said Douglas.
The Government is pushing to accelerate the pace at which consumers have access to electric vehicles (EVs), the greener alternative to gas-fuelled autos.
Some 50,000 are projected to be in use in the country by 2030, with the Government’s trial programme underway to convert many state-owned fleets.
JPS, too, is in the trial phase and is anticipating a 20-vehicle fleet in the months ahead.
However, the CFO said that it was difficult to project an adoption rate for the vehicles islandwide because of global supply-chain issues.
“Car manufacturers can hardly find the chip to put in cars ... . You have favoured more developed markets that are ahead of us in the chain, but we certainly are trying to encourage as fast as possible,” he said, adding that the roll-out of the charging ports serves to enable the market.
“We acted to enable EVs and for others to follow and for car importers or dealers to create the conditions. We don’t expect to have a positive return on those charging stations,” he added.
Meanwhile, the JPS executives said that the locations of the charging stations were determined after a “careful” study with consultants to have motorists always within 30 minutes of one.
They said the demand is greatest in urban areas.