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Government Working on New National Energy Policy

April 30, 2004

The Key Point:

The Government is currently formulating a new national energy policy, which should be completed within the next six months.

The Facts

  • The policy which will extend to 2015 is expected to focus on alternative sources of energy among other things.
  • Prime Minister P.J. Patterson who made the disclosure in his contribution to 2004/05 Budget Debate at Gordon House on Tuesday, April 27, expounded on the point on Wednesday (April 28), at his post-Budget press briefing at Jamaica House.

The Full Story

The Government is currently formulating a new national energy policy, which should be completed within the next six months. The policy which will extend to 2015 is expected to focus on alternative sources of energy among other things.

Prime Minister P.J. Patterson who made the disclosure in his contribution to 2004/05 Budget Debate at Gordon House on Tuesday, April 27, expounded on the point on Wednesday (April 28), at his post-Budget press briefing at Jamaica House.

He said the new energy policy was being designed against the background of Jamaica’s high-energy bill, which had escalated in the last five years, moving from US$313 million in 1998 to $813 million in 2003, outpacing the growth in export earnings.

“When you look at the increase in our foreign exchange expenditure arising from the escalation of gas prices, it is something that we simply cannot afford,” he said.

The Prime Minister said as a result, the country had to look at energy conservation, alternative forms of energy and pricing questions. “This is a national question and it’s not something that people have to be kicking around as a cheap political football,” he said.

The national energy policy, he noted, would look at the elements that would be needed to address allocation of resources and its priorities.

Discussing other sources of energy, Mr. Patterson said the introduction of natural gas would also open up new opportunities for its use in the fleet transport, as well as expansion of new power and the bauxite/alumina plants.

The other benefits from the introduction of natural gas would be the enhanced protection of the environment and development of a gas park that would allow for the development of light industries and food processing, thus creating additional jobs.

Local and foreign private investors, as well as bilateral and multilateral agencies, he said, had shown keen interest in participating in the financing of this project.

He informed that the Government was engaged in discussions with potential sources of supply and developing Caribbean-specific formulae for benchmarking and indexing the long-term price of Liquid Natural Gas (LNG) that would form the basis to negotiate the supply contracts for the Jamaican market.

“I take the opportunity to publicly thank the government of Trinidad and Tobago for the constructive approach it is taking in our bilateral discussions on an appropriate LNG supply arrangement,” he said.

Mr. Patterson also disclosed that there were plans to develop an LNG hub in Jamaica for re-export to other regional markets.

“We will be shortly commissioning a feasibility study, as well as the development of a regulatory framework to introduce natural gas into Jamaica’s energy supply mix by 2007,” he said.

Meanwhile, he also cited renewable energy sources such as wind power and solar energy, adding that the initial target was for such sources to supply 10 per cent of energy consumption.

Another source, he said, was that of ethanol produced from sugar cane and pointed out that ethanol was considered to be the best replacement. He added that it would be technically feasible for the ethanol content of gasoline to ultimately reach 10 per cent, moving from five per cent.

Ethanol production from sugar cane, he said, would produce a significant market opportunity for the industry, as in the case of Brazil and India.

The Prime Minister also disclosed that an energy-efficiency unit had been established in the Petroleum Corporation of Jamaica and that an energy trust fund to provide development financing for projects in the productive sectors was to be set up.

Last Updated: July 4, 2019

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