Agencies seek financial ‘energy’ boost
A number of regional and international agencies are gathered here hoping to come up with possible way of bridging the financing gap for the development of sustainable energy in the region.
Representatives form the Ministry of Energy, the Caribbean Development Bank (CDB), The Caribbean Community (CARICOM) Secretariat, the United Nation (UN), the German Federal Enterprise for International Cooperation (GIZ) programme and the Caribbean Renewable Energy Development programme are taking part in a four-day workshop aimed at developing tools and approaches for the financing of sustainable energy projects in the Caribbean.
Addressing the opening of the workshop last evening at the Accra Beach Hotel, Minister in the Office of the Prime Minister with responsibility for Energy Senator Darcy Boyce said the region had the capacity to build the renewable energy sector while creating hundreds of jobs.
However, Boyce cautioned regional policymakers not to rush into implementing national energy policies without conducting careful research and ensuring that those policies were tailored for each territory.
Stating that financing options had “expanded significantly” in the last two years, Boyce said perhaps greater promotion of those financing options was what was needed.
“The Government of Barbados recognizes that limited access to financing tools for sustainable energy projects can hinder the development potential of Barbados’ economy. There is a need therefore to recognize, acknowledge and promote the financing tools available so they can be marketed to meet the challenge of sustaining, or even accelerating, investment in energy as a key sector to the economy,” explained Boyce.
UN Resident Coordinator Stephen O’Malley pointed out that the Caribbean had some of the highest electricity costs in the world, adding that in some cases it was “four times that of some neighbouring developing countries”.
At the same time, he highlighted that the region had an abundance of renewable energy resources. He said it was therefore imperative that regional leaders prioritize clean energy projects that could have a substantial positive effect on the people and the economies.
“Unfortunately, there remain a number of significant barriers to the widespread employment of these energy solutions. One of the most crippling of these barriers is the availability of, and access to appropriate financing options that can truly develop and catalyze the clean energy industry,” said O’Malley.
He said facilitating the financing for sustainable energy projects “has to be a priority for governments, development partners and international financiers” if the region were to take full advantage of the potential of renewable energy and energy efficiency projects.
Meanwhile, Tessa Williams-Robertson, head of renewable energy and energy efficiency unit at the Caribbean Development Bank (CDB) said bridging the gap of appropriate financing for the development of sustainable energy in the region was critical if there were to be increased investment in that area.
“Within the financial sector the perception of high risk associated with sustainable energy investment remains and forms a significant barrier to project implementation even where investment costs compare with savings yield a reasonable payback period,” said Williams-Robertson.
“Appropriate tools are required to analyze and support the risking process and to increase the comfort level of the financiers,” she added, stating that the workshop was a small but critical step towards a less risky perception and a greater level of comfort.
Also addressing the launch last evening was principal advisor of the Caribbean Renewable Energy Development Programme Thomas Scheutzlich, who described the workshop as timely and important.
He said while there were a number of technically and economically feasible energy projects, they were not implemented because often, only partial investments were offered.
“Why is it like this? Maybe the legal or regulatory framework does not encourage its implementation or incentives . . . but one reason sometimes is that the beneficiaries do not believe in the energy yields and savings…” he said, noting that the workshop would allow the participants to develop special tools that could help financial institutions calculate the economic benefits of energy projects.
The workshop is the second in a series. The first was held in 2014.