OUR drags on private use of JPS grid
BY CAMILO THAME Business co-ordinator thamec@jamaicaobserver.com
Wednesday, March 02, 2011
THE Office of Utilities Regulation (OUR) has pushed back by more than a year the date to make a determination on a new regulatory mechanism that will give private entities access to Jamaica Public Service Company's (JPS') distribution lines to provide its own electricity at several sites across the island.
The delay has left at least one interested entity — Jamaica Broilers — dissatified with the pace at which government has been approaching critical changes to energy policies.
"Our energy policy and the strategies we pursue are the most important things that this country faces at this time," Jamaica Broilers Group president and CEO, Chris Levy told the Business Observer. "It is absolutely necessary to be taking the big strategic decisions now."
Also, in commenting on the slow pace of Government to introduce alternative fuel sources for electricity generation, such as coal, Levy said the country "cannot delay these decisions any longer".
Initially the OUR aimed to conduct public consultations and issue a determination on 'wheeling', by June 2010 but the new date to issue a determination is set for November 2011.
The process to reach a determination now involves cost analysis and consultancy to determine wheeling charges.
Wheeling concerns the development of terms and conditions that would allow a private entity to provide its own electricity at multiple geographical locations transiting JPS' network, a scenario that is contemplated by Condition 2 clauses 11 and 12 of the JPS All-Island Electricity Licence.
In its corporate plan for the next three years -- currently available on the regulator's website for public comment -- the OUR said it "is aware that there is some interest among private entities to self generate electricity for supplies at disparate geographical locations and that this can only be facilitated if there is in place some kind of wheeling arrangement with JPS. In view of the potential that this holds for driving incremental expansion, creating greater diversity and perhaps efficiencies, the Office is keen to facilitate this option."
Among interested entities is Jamaica Broilers, which, with its co-generation facility at Spring Village in St Catherine, would seek to provide electricity to other sites from which it operates, such as its ethanol plant and feed mills located in Old Harbour.
"We have the installed capacity at our co-generation plant... which is considerably more efficient than buying it from the grid," Levy said.
The cogeneration plant consists of three medium speed diesel engines (rated at 5 megawatts each), two Caterpillar engines for stand-by purposes, one heat recovery steam generator (HRSG) that utilises the hot gases from the engines to produce steam for the chicken processing facility, and an auxiliary boiler.
At present, Levy says the excess electricity is sold to the grid at dumped rates, which doesn't provide a "good business option" for the company.
