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PPPs in the Caribbean: Filling the gap

Brian Samuel's picture
Prior to about 2005, for many tourists their Jamaican vacation was ruined at the last minute, by the hot and overcrowded conditions inside Montego Bay’s Sangster International Airport. Fast forward 10 years, and waiting for a flight at Sangster is an altogether more pleasant experience. The air conditioning actually works, and the whole environment is infinitely less stress-inducing than before.
 
A new waiting area at Montego Bay's
Sangster International Airport.
Photo: Milton Correa/flickr

What’s the difference? The private sector.

In 2003, the Government of Jamaica finally succeeded in doing what it had been trying to do for a decade: privatize Montego Bay Airport. A private sector consortium, led by Vancouver International Airport, quickly invested millions of dollars in expanding the terminal building, doubling the airport’s capacity and opening dozens of new retail spaces. Since then, the consortium has invested more than US$200 million on expansions and improvements to the airport, all of which has been entirely off the government’s balance sheet.

Jamaica has gone on to implement several more public-private partnerships (PPPs), with mixed results. The second phase of its ambitious highway construction program — the Mount Rosser Bypass — was recently opened, cutting a swath through miles of virgin territory. However, early indications are that traffic levels are not living up to expectations, probably due to the Bypass’ steep eight percent gradient, which is beyond the means of most Jamaican trucks and buses.

In the energy sector, Jamaica is completing three PPPs with a total of 115 megawatts of renewable energy (RE) capacity, putting the country on track to meet its RE target of 12.5 percent of generating capacity by the end of 2015. Lastly, the government is currently completing formalities for the sale of Kingston Container Terminal (KCT) to a consortium of CMA/CGM and China Merchant Marine, a transaction that is expected to result in a US$600 million capital expenditure program by the port’s new owners.

Benefits to the poor from clean and efficient energy use

Daniel Kammen's picture

The December 2011 Climate Conference (COP 17) in Durban, South Africa, presents a tremendously important opportunity to advance both the globally critical goal of climate protection, and to do so synergistically with a local agenda of sustainable development and poverty alleviation. 

 

The COP 16 meeting in Cancun last year, while in many ways an important step forward, particularly on the role of energy efficiency, did not result in decisions on the global accord, and much remains to be done. One remedy for this situation may be to achieve local successes that demonstrate how climate protection and clean and efficient uses of energy can directly benefit the poor.

 

The fact that the COP will take place in Africa, which has the highest unmet need -- and demand for reliable and affordable energy access – brings to a head the need to find new tools and paths that can meet both goals. As the plans for the Durban Conference evolve, there must be a premium on action that implements this strategy.

 

A new multi-donor program which is part of the Climate Investment Funds and is managed by World Bank Group and Regional Development Banks, may be an ideal component of that plan:  the new Scaling up Renewable Energy in Low-Income Countries (SREP) program, provides an exciting avenue to meet both goals. Six pilot countries, Ethiopia, Honduras, Kenya, the Maldives, Mali and Nepal, were selected for initial blocks of funding to bring clean energy technologies rapidly to meet the unmet demand for energy. Discussions are underway to bring in funding to double this pilot group.

 

Last month in South Africa, I had the opportunity to see just how a program like the SREP could build on both local innovative capacity, and the political attention that COP17 can bring to climate and development needs. The World Bank office in Pretoria hosted a meeting of African Ambassadors to South Africa, where I had the opportunity to discuss with them (see picture above) both market changes taking place in the region, and technology options to rapidly bring clean energy to the poor.