Public Private Partnership in Action Launch of Jamaica’s participation in the UN Secretary General’s

Sustainable Energy for All (SE4ALL) initiative

July 31, 2012

Jamaica Conference Centre

Presenter: Michelle Chin Lenn – Project Manager

AGENDA•Wigton Overview

•Current Renewable Energy context in Jamaica

•Opportunities and barriers to Sustainable Energy for All (SE4ALL)

•Role of public-private partnership▫Examples and success stories

WIGTON OVERVIEW

WIGTON WINDFARM• Wholly owned subsidiary of the Petroleum

Corporation of Jamaica

• Agency of the Ministry of Science, Technology, Energy and Mining (MSTEM)

• Incorporated April 2000

• Aim is to be a catalyst for renewable energy

• Owns and operates 38.7 MW windfarm complex

LOCATION OF WIGTON

Wigton I • 20.7 MW • Commissioned 2004• 23 NEG Micon (NM52) WTGs• Rated 900 kW each

Wigton II• 18 MW • Commissioned 2010• 9 Vestas -V80 WTGs• Rated 2MW each

RENEWABLE ENERGY CONTEXT IN JAMAICA

JAMAICAN ENERGY SCENARIO Regulated Electricity Sector

Liberalised Generation Market

Monopoly on Transmission and Distribution

Heavy Reliance on Imported Fossil Fuels High exposure to price volatility ~94% - Oil Based Electricity Generation

Electricity Grid 943 MW installed

64.3 MW Renewables (Wind & Hydro) 7% Renewables by installed capacity ~5% Renewables by electricity contribution

Source: JPS, Jamaica Power Summit, April 20, 2012

RENEWABLES IN JAMAICA

Wind is 2.7% of annual electricity generation

From 41.93 MW total installed

3 wind farms Munro Wigton 1 & Wigton II

Hydro is 3.4% of annual electricity generation

From 22.4 MW total installed

7 Hydro Plants Less than 5 MW each

RENEWABLES – POLICY TARGETS

1995 Energy Policy followed by National Energy Policy: 2009- 2030 Diversification of fuels Development of renewable energy resources

Increase Jamaica's renewable energy use from ~6.1% in 2009 by MWh to 11% by 2012 12.5% by 2015 15% by 2020 20% by 2030

Target revised to 30% by 2030

Sustainable Energy for All (SE4ALL) - Objectives

OPPORTUNITIES AND BARRIERS TO SE4ALL

BARRIER MITIGATIONInitially Low Rate/ kWh based on long run avoided cost

• MSTEM Commissioned Renewable Energy Tariff Study in 2012

• Cabinet Submission being prepared

Data and Studies • Hydro studies updated – PCJ, 2010• Wind Resource Assessment – Wigton/IDB

• Final Report due June 2013Land

Interconnection • Grid Injection study – Being arranged through MSTEM/Worldbank 2012

Financing Structure • Jamaica’s country risk adds burden to project finance

• Development/ Green financing instruments

Type Entity Size (MW)

Projected MWh Location

Wind JPS 15- 20 45,990 – 52,560 Munro

Wind Wigton III 24-30 63,072 – 78,840 ManchesterWind CAEL 24 63,072 ManchesterWtE PCJ 41-46 325,000 RivertonWtE PCJ 18-25 140,000 Retirement

Hydro JPS 6.3 26,500 MaggottyHydro PCJ 40-80 157,680 – 315,360 VariousBiomass Ministry/PCJ 3.1 26,000 DuckenfieldBiomass Ministry/PCJ 18 142,350 FromeTotal Up to

252.4 MW

Up to 1,169,682MWh

OPPORTUNITIES

• 1,169,682 MWh from RE represents 28.3% of the 2010 Electricity Generation therefore a significant potential

ROLE OF PUBLIC PRIVATE PARTNERSHIPS

PUBLIC VS PRIVATERenewable Energy Deployment in Jamaica has been historically slow due to:

1) High capital cost of technology therefore, long payback periods 2) Private Sector interested in quick returns

3) Commercial bank loan structures not providing:▫ Long moratorium on interest during development and construction▫ Long tenure loans▫ Low interest rates

• Therefore, opportunity for restructuring private sector financing instruments or investor criteria to facilitate more public-private partnerships

Possible Public-Private terms

Source: Thomas Timmins, Gowlings, Jamaica Power Summit presentation, April 2012

PUBLIC - PRIVATE DIALOGUE• Wigton is 100% government owned and not to be seen as competition

in the renewable market but as the catalyst to demonstrate and motivate other entities to get into the renewables business▫ Thus Wigton has shared information, knowledge and experiences at

numerous seminars and workshops

• As there was little uptake on renewable energy projects (eg. before JPS Maggotty expansion the last hydro investments were in the 1980s), government lead with implementation of the first commercial scale wind farm for the benefits to the country

• Advocate private sector involvement in manufacturing/ assembly of renewable energy equipment to drive the costs down (cheaper local labour and employment possibilities) and even export renewable energy products (eg. St. Kitt’s assembling PV)

EXAMPLES and SUCCESS STORIES

JPS Munro Wind Farm (3 MW)

• Wigton 100% government owned▫ Financed through PetroCaribe as more attractive than local commercial

bank proposals▫ Thus opportunity to finance Wigton III with more private involvement if

terms adjusted as outlined before

•JPS – private and government owned▫Accessed funding from IFC due to majority private

ownership

WIGTON II (18 MW)

WIGTON II – PHOTO HIGHLIGHTS

CONSTRUCTION HIGHLIGHTS Wind Turbines arrived April 4, 2010

Hubs at Port Esquivel

Hubs 18.141 tonnes (18,141 kg)

Generator Details Rated speed: 1680/2016

RPM 690 V, 50 Hz 2 MW

CONSTRUCTION HIGHLIGHTSNacelles Houses Drive Train:

Gearbox Shaft Generator Yaw systm

67 tonnes

Hubs at Port Esquivel

CONSRTUCTION HIGHLIGHTS

Towers 67 m 160 tonnes 3 pieces

Hubs at Port Esquivel

CONSTRUCTION HIGHLIGHTSBlades 39 m 6.5 tonnes Rotational speed

Static: 16.7 RPM Operational: 9-19 RPM

Hubs at Port Esquivel

CONSTRUCTION HIGHLIGHTS

FOUNDATIONS

Diameter = 15.6 mDepth = 2.6 m Steel = 25.462 tonnesConcrete = 327 m3 each• Except T30 which had

898.6 m3

Foundation Details

Foundation Steelwork at T26

CONSTRUCTION HIGHLIGHTS

CABLING

CONTROL BUILDING

CONSTRUCTION HIGHLIGHTSWIND TURBINE ASSEMBLY 600 ton crane used

New Substation New Resource Centre for training

CONCLUSION

Wigton has successfully commissioned and operating two wind farms

Wigton is committed to technology transfer to Jamaicans and is actively developing its resource centre offerings while continuously training and exposing its staff

Renewable Energy potential to meet Government targets is identified

Wigton will continue to lobby for more comprehensive renewable energy policy and legislation to facilitate the realization of the identified renewable energy projects

Wigton actively seeks innovative Private Public methods of implementing these renewable energy projects

Questions ?