The renewable energy challenge amongst hydrocarbon economies

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The availability, form, cost and versatility of a nations’ energy sources exert a significant influence on their economic well-being and is a reflection of the level of commerce and industrialization that are available to its citizens. With the exception of Trinidad & Tobago, CARICOM member states are net importers of energy with most energy imports being fossil fuels and associated refined products (Figure 1). These imports account for up to 30% of total export earnings of smaller, service-oriented member countries and up to 60% for the more industrialized countries such as Jamaica and Guyana. Coupled with a dependence on fossil fuels are inefficient electricity generation, transmission and distribution processes with estimated losses exceeding 60% of the total energy generated. 

The impact of carbon-based energy sources on the climate and environment is “unequivocal” with increases in CO2, methane and nitrous oxide cited as the primary reason for changes observed in the environment and atmosphere. The last five years (2016-2020) is documented to be the hottest period in the instrumental record since 18505. The resultant threat to CARICOM member states includes rising sea levels, unpredictable hurricane patterns, increased rainfall volumes and extremes in temperatures; these states are even more vulnerable to these effects because of their small sizes, varying topography and/ or fragile economies. 

The need to stem the 1.5 deg C rise in global average temperatures over the next 10 years has long been recognized by Caribbean states as reflected within the Caricom Energy Policy whose vision is, in part:

“Fundamental transformation of the energy sectors of the Member States of the Community through the provision of secure and sustainable supplies of energy in a manner which minimizes energy waste in all sectors…” 

This overarching policy sets a guiding framework for member states in matters related to sustainable energy supply, deployment of renewable energy sources, energy efficiency & conservation, research and innovation, among other objectives.  It is however no surprise that Caribbean economies have responded differently to the call for action given their unilateral governance structures and varied economic drivers. The countries of Trinidad & Tobago, Barbados and Guyana provide interesting case studies for the needed energy transition, given their fossil fuel resource base. Barbados peaked at approximately 1900 barrels of oil per day in 1999 and is now a regional leader in establishing renewable energy technologies and policy. Trinidad & Tobago is still a significant producer of both oil and natural gas, with the latter predominating. Some would argue their energy transformation actions are slower relative to Barbados attributed to a number of social, governance, economic and cultural barriers to change. Guyana is arguably the fastest transforming economy among Caribbean states moving from predominantly agrarian and bauxite-based activities at the turn of the century to improvements in their technology and service sectors, followed by large hydrocarbon finds since 2015. As of 2014 energy sources from renewables accounted for less than 1% of their total energy mix with imported fossil fuels supplying approximately 92% of the country’s fuel needs. Similar to Barbados and Trinidad & Tobago, the country has demonstrated its commitment to energy efficiency and a low-carbon future through its policy and program initiatives. Unlike these countries, Guyana is at the forefront of a budding hydrocarbon-based economy with environmental conflicts already emerging from their proposed hydrocarbon-based projects.  

Each country is at a different path in the quest for lower carbon emissions, energy sustainability, renewable energy technology and efficient power generation. Through ratification of the Kyoto Protocol and their various policy positions, they have all shown a commitment to green initiatives and a low carbon future. All three countries have set aggressive targets for the implementation of renewable energy; Barbados seeks to attain 100% RE supply by 2030 while Trinidad & Tobago aimed for a 15% reduction in emissions over that time period. Guyana aims to attain 47% renewable energy generation by 2027.  Yet some will argue that the current energy mix and planned programs of each is not on schedule to meet with these targets and much more has to be done in the short term.  

Hasley Vincent