Recently, in an editorial piece entitled, “Becoming the green powerhouse” we implored the Minister responsible for energy, Honourable Asot Michael to push hard for a re-examination of the government’s policy (or APUA’s) as it relates to net metering of renewable energy installations at the residential and commercial level.
We pointed out that the recent change from net metering to net billing was a retrogressive step in our energy evolution as it dis-incentivised the private sector from investing in alternative energies such as wind and solar.
For those who are unfamiliar, the policy changed from “net metering” whereby a homeowner or business would net their consumption against their renewable energy production. In simplistic terms: produce 100 units of energy and use 100 units and your electricity bill would be zero. Produce more and APUA gets free energy to sell … produce less and you pay APUA for the difference. The policy allowed for a decent payback on the private investment in infrastructure and is designed to speed-up the adoption of renewable energy in the private sector.
Shortly after the Antigua & Barbuda Labour Party (ABLP) won the 2014 election, the powers that be said that the policy that existed was taking advantage of APUA; since APUA was being “used” as an energy storage by having to provide power during the night. The change saw a shift to “net billing” whereby APUA would buy the energy produced by private citizens and businesses at about 45¢ and sell them at over $1.00 retail rate.
For smaller installations, there is the ability to utilize what you can during the day (when you are not home) but any excess is bought by APUA at the less-than-half-of-retail-rate of 45¢ and sold back at over twice as much as it was purchased. Larger business-sized installations are capped and the net billing policy goes to the extreme in a billing scheme referred to as “buy all, sell all”. In those cases, APUA buys all the renewable energy produced by your system at the 45¢ and sells it back to you at over $1.00!
We did quite a bit of research into the matter to try to figure out what would cause the government and APUA to take such a backward step and discovered that the policy was changed simply to “protect” APUA and its deals with energy suppliers. Essentially, the citizenry were being penalized so that APUA could continue to be “profitable” and maintain its contracts with its suppliers.
Ironically, the prime minister confirmed one aspect of the government’s logic during the launch of the 3 megawatt solar installation at the airport. He said, “APUA has over 800 employees, and the truth is, if we diversify too fast into alternate energy, then it will impact negatively on the profitability and perhaps the survivability of APUA.”
Too fast? What?!? By all factors, the adoption of renewable energy by the private sector has been fairly negligible. So negligible, in fact, that the government counts all non-commercial scale installations against its private sector goals. So that means that all the smaller installations at the government buildings and schools, etc. are bundled into the private sector count just so that it appears to ‘move the needle’ and show some progress in the adoption of renewable energies.
Truth be told, APUA is glad that the government is going solar because they don’t pay for their energy consumption in any case. On the other hand, they do not want the people who do pay their bills to seek an alternative. That would mean less revenue for APUA and that is a scary thought for some. But that is an extremely myopic view of the world.
One of this country’s greatest disadvantages in attracting businesses and doing business, especially in the small manufacturing sector, is the cost of our energy. When we compare ourselves to the United States where, according to the US Energy Information Administration, the average cost of electricity in 2015 was US$0. 10 cents, the disparity is obvious. Obviously, the cost comparison with the US is not what some people may consider “fair” but we use the US because even with an average cost of just 10 cents for traditionally produced electricity, that country is heavily promoting incentives for the adoption of renewable energy.
This is not a red, blue, green or otherwise issue, it is an Antigua & Barbuda issue. We have to ask ourselves: where are we going with our energy policy and what is the responsibility of our government and our utility to support us on that journey?
We hear and understand the arguments regarding APUA, but from our perspective, they are not potent enough to trump the long term energy production and consumption goals of our bit of paradise.
We turned to Minister Michael before and based on the useful guidance he provided at that same launch event, we turn to him again. He said, “… the remarkable solar energy which streams down upon us is a blessing. Our bright sun attracts tourists to our country and gives us a crucial supply of energy when converted. My government can then strategize to bring significant reductions in the foreign exchange spent on oil and gas, and to reduce the cost of energy to all consumers. At the same time, this shift to renewable energy will result in a more pristine environment in which our people and visitors will thrive.”
He continued, “While world oil prices may be low at this time, it will not last forever. Oil prices remain vulnerable to sudden disruptions of supply from a number of sources around the world. When that happens, the price of oil can shoot upwards. The Eastern Caribbean is, thankfully, a zone of peace; we are also very conscious of the responsibility to protect our environment, and to safeguard this Little Bit of Paradise that the Almighty gave to us. To utilize our own abundant solar energy resource, available 11 hours each day, is to do God’s will.”
Clearly, the minister gets it and we implore him to share that vision with his colleagues so that we can all invest in making the move to renewable energy.