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Friday, 9 March 2012
Response to: A logical Approach to Economic and Social Development
Topic: Energy Use
Dear Editor, I would like to commend Dennis Chung on his contibution “A logical Approach to Economic and Social Development” in the Caribbean Business Report, dated Friday, 2 March 2012.  I support his observation that “the only realistic short-term project now is tax reform”: not public sector rationalization, nor pension reform.  We cannot afford to labour upon short-term initiatives any more.  Our comparative advantage and international productivity needs to be addressed  to deal with the trade deficit.  Towards this end, I concur that investments need to be made in capital infrastructure in areas of comparative advantage: notably tourism and agriculture.  Also, our food and oil imports need to be reduced.  But, this will not be an easy task, particularly with regard to reducing our dependence on oil imports. In this regard, I would also like to commend the University of the West Indies, and Professor A. Anthony Chen in particular, for hosting the Lecture Series “Climate-Energy Nexus: Call to Action”.  In the last lecture on 21 February 2012, Mr. William Saunders spoke on “The Energy Situation in Jamaica” where he gave an historical perspective of Jamaica’s worsening energy situation particularly as it relates to poor political decisions, or lack thereof.  Jamaica is a high consumer of oil, but before we blame it all on the politician we should be aware that on the demand side we have a problem with rising per capita consumption: which means we give too little regard to energy efficiency and conservation. Jamaica’s Energy policy 2006 – 2020 tells us that 36.6% of oil imports is used in Bauxite/Alumina processing, and 7.7% for aviation and shipping: both being export activities.  24.7% is used in the electricity sector and 23.5% in the transport sector.  So, only reduction of oil imports in these latter sectors would appreciably reduce our trade deficit.  In the transport sector, the Obama administration allowed older inefficient vehicles to be traded in at concessionary rates for new ones; but would this result in the desired 30 – 50% reduction of oil imports?  In the electricity sector, we now have net-metering, and Germany even paid rates in excess of that charged by utility companies to encourage production of solar energy; but, most of our energy demand occurs at night between 5:00 – 11:00 p.m. To our limitations of short-term and extreme thinking, let us add poor execution.  The Jamaica Energy Policy green paper was completed six years ago and we’ve had an energy-efficiency building code for seventeen years now.  How much has changed during this time?  Approximately, 60% of our electricity is consumed by commercial and industrial groups.  If we are truly concerned with dealing with our trade deficit, these groups have to be at the forefront of our effort.  I write not to discourage the forward-thinking among us but to forewarn that the task at hand will not be easily attained without hard work and dedication.  Are we up to the task?  Paul Hay MBA, BA(Arch.)
Managing Partner
PAUL HAY Capital Projects

Caribbean Capital Projects Management

P. O. Box 3367
Constant Springs, Kgn. 8
Jamaica, W.I.

tel: 1 (876) 756-0631
cel: 1 (876) 324-4274
fax: 1 (876) 756-0631

skype name: phcjam


Posted by phcjam at 5:07 PM EST

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