Geopolitics and energy policy

The Editor, Sir:

The Americans and Germans, adding solar energy to their respective electricity mix, have grabbed attention and rekindled concerns on the cost of electricity in Jamaica. That was the subject of a robust debate on one of our talk shows, a few days ago.

The debate, however, had been oblivious of an important underpinning of the American initiative - geopolitics. Caution would be in order before recommending the adoption of such a strategy to our needs.

There are several sources from which the production of electricity can be achieved. Among them are coal, shale, peat, wind, hydro, nuclear and fossil fuel/oil. Most, if not all,

of these resources can be found in the United States. Jamaica is not without peat, wind, hydro and solar while the Waldron Basin, off the course of Savanna-la-Mar, and other areas within our geographical jurisdiction, have raised prospects of locating deposits of fossil fuel. One of the considerations given to exploiting these resources, of course, is cost.

Unwise comparison

Until the advent of Organisation of the Petroleum Exporting Countries in the early 1970s, oil seemed to have had the advantage. A 20-year-old Jamaican might find it incredible that up to the later 1960s, a gallon (not litre) of gas was being sold for about 15 cents as against today's $450 upward. But then, the cost of a barrel of oil was like US$5 to today's US$75 or upward. For reasons mentioned below, oil might still be the best option today for many countries, notwithstanding the escalation in cost.

Despite the escalation in the cost of oil and the abundance of sunshine, solar energy has been sparingly used in Jamaica to heat water in a few hotels and homes. The cost of the infrastructure has made wider usage virtually prohibitive. However, in the American case, the decision to exploit solar energy at this time has transcended the cost factor, which might have been a determinant earlier.

For more than a decade, the Americans have been concerned with what they have regarded as the volatile and unstable political situation in the Middle East, the major external source of their oil supply. In countering, they have adopted a policy to lessen their dependency on external sources, particularly sources they have considered to be hostile to their 'interest' and security. In short, we must be careful how we compare our situation with other countries, because the imperatives may not necessarily be common.

Our new energy policy, unlike the Americans', is still dependent on external supplies. It has been shifted from oil to LNG (not solar) with a projected saving of 25 per cent - 30 per cent to the ultimate consumer. But it had been disputed by the parliamentary opposition, citing the omission of the critical cost of the infrastructure necessary to pipe the gas to consumers. When that is added, the opposition contended, the projected saving would not be realised.

While the price of oil has escalated, it is not the primary factor driving up the cost of electricity to the Jamaican consumer. It is the archaic and obsolete productive plant ('Gov't technocrats flay JPS over energy price', The Gleaner, Wednesday, September 9, 2009) and the failure of relevant authorities to enforce conditions of sale which have to do with the refurbishing and efficiency of the plant.

Before we lock ourselves into LNG contracts, perhaps we should grant ourselves the favour of hastening the refurbishing of the processing plant and make a determinant of the data available on the potential of the Waldron Basin, etc. It would be foolhardy, after making massive investments in LNG infrastructures, only to hear that we have been blessed with large commercial deposits of oil.

I am, etc.,

LIONEL RUSSELL

Ensom City

St Catherine