CUC seeks wind power partners

Electricity supplier CUC is seeking partners to create windmills to generate power in Grand Cayman in reaction to skyrocketing fuel prices.

The last time CUC considered wind energy was in 2003 after a year-long study into the feasibility of the alternative power when it concluded that investment in wind energy was uneconomical.

But with the rising price of fuel and ever-increasingly large electricity bills as a result, CUC is now reconsidering the economical viability of wind power, the electricity company’s corporate secretary Douglas Murray said.

The project would be entirely privately funded by whatever entity presented the best options for wind power generation, he said, adding that at this stage it was unclear how many or how big the wind turbines would be, or where they would be located.

‘It did not seem to be economical until quite recently when the price of fuel skyrocketed. That coloured our interest in whether we wanted to see what parties were serious about coming to Grand Cayman. We’re looking at any parties that think they have a viable proposal,’ Mr. Murray said.

Any wind-generation project emanating from this initiative would need the go-ahead from the Energy Regulatory Authority.

Mr. Murray admitted that if the price of oil dropped significantly – and it has been falling over the past week or so – then CUC may reconsider whether wind energy should be pursued.

However, the introduction of electricity-generating windmills to Grand Cayman would not mean that plans by CUC to create an additional fuel-burning 16 megaWatt generator next year, nor another two 16 megaWatt generators in 2011 and 2012, would be put on hold.

‘Obviously we’ll analyse the situation and not provide something unnecessary,’ he said, but added that since wind power was considered ‘non-firm energy’ and could not be relied upon to be present at all times, CUC would need a back-up energy generator to ensure continued supply.

CUC has 15 diesel and two gas turbine generating units with a combine capacity of 136.6 megaWatts.

Earlier this year, CUC signed a 20-year electricity transmission and distribution licence which enables the company to purchase alternative energy.

But Richard Hew, president and chief executive officer of CUC, admitted customers should not expect lower power bills soon. ‘While we do not foresee a significant rate reduction from early wind projects, we do expect to prove the technical viability of this energy source and establish a basis on which we can stabilise power costs through expansion of renewable energy,’ he said.

The 2003 report, which will be given to companies that express an interest in investing in wind power generation in Cayman, was based on wind speed measurements taken over a year in the High Rock area of East End and the high-elevation area of North Side.

Donald Hardy of Panaero, the Colorado-based wind power consultancy which carried out the 2003 feasibility study, said creating 10 megaWatts of energy ‘would require 10 to 15 relatively smaller sized wind turbines which are more suitable to an island setting.’

The hubs of such turbines are approximately 165 feet high, with the rotating blades being another 60 feet tall.

‘A lot of things have changed in the past five years since we did the report. Oil prices have increased a great deal and the cost of electricity has gone up lot. Also the wind power technology has continued to improve,’ Mr. Hardy said.

He added that the technical viability of wind power was obvious. ‘Global wind power in 2007 was over 1,000 times larger than CUC’s peak load. Commercial wind power in 2007 was installed in over 70 countries. There’s a definite track record,’ he said.

Referring to the invitation by CUC for wind generation developers to pitch projects, he said: ‘It’s a useful first step, but it’s more of a gesture than a programme. It’s a broad brush exercise that leaves a lot unspecified,’ he said.

Mr. Hardy also called on the Cayman government to implement a policy for renewable energy.

The Department of Environment welcomed CUC’s move, with deputy director Scott Slaybaugh saying. ‘It is encouraging that this is being looked at in earnest.’

He said that the DoE had previously examined wind energy proposals for Grand Cayman, but it had not resulted in any final developments. The department wants any developer considering erecting wind turbines to carry out an environmental impact assessment study before the windmills are erected.

A response by the DoE to an earlier wind turbine proposal drew attention to visual and noise intrusion, electromagnetic interference and possible wildlife collisions. It also expressed concern that windmills may be abandoned and become a scar on the island’s landscape if they turned out not to be as profitable as anticipated.

Nick Robson of the Cayman Institute, a think tank for policy research in areas such as global warming and climate change, said of the CUC announcement: ‘I am extremely glad to see that they are going down this route. I don’t think that CUC or the Cayman Islands as a whole has any choice at this point in time. We have to move in the direction of energy security as quickly as possible.

‘Oil prices have come down in the last week or so, but it is only temporary… At the rate we are using oil, there is only three years worth of oil left,’ he said.

He said he was not surprised that CUC was considering alternative energy sources at this time. ‘There is no comparison between the price of oil in 2003 and now. They are a commercial entity. The basic premise is to make money for its shareholders. They are going to go with whatever brings in the biggest profit.’

He added that it was also time for the government to step up and make it easier and cheaper for people to turn to alternative power. ‘What the government now needs to do is to cut import duty on all alternative energy equipment and supplies. We met with Cabinet last August and suggested they take the initiative on bringing duty down on this equipment. Not much happened after that.’

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