Belco: Renewables still more expensive than oil in Bermuda
Solar and other renewable energy sources may be cleaner and cost-effective elsewhere, but in Bermuda they are still considerably more expensive than oil.
This from Belco after former CIA director James Woolsey urged Bermuda to go solar in a speech to Business Bermuda on Wednesday, saying the Island needed to end its nearly 100-percent dependence on imported oil because the cost of petroleum had become increasingly volatile and unpredictable.
But Belco said yesterday: “The speaker referred to low costs for renewables, but he certainly did not take into account variables, including the cost of (solar panel) installation locally.”
Belco said it’s actually exploring importing natural gas, which could be a “promising alternative” to oil.
Mr Woolsey’s speech stirred up debate online, with dozens weighing in on whether solar energy would work here.
“Mister Wolf” wrote: “I looked into solar, the payback was almost 10 years and I have nowhere to put 210 square feet of panels. Solar right now is NOT the answer, the cost of installation is ridiculous.”
Former Government energy analyst Chris Worboys said he disagreed that solar energy was pricier here, pointing out Belco energy costs are 40 cents a kilowatt hour compared to about half that for solar power, once installed.
“Following years of declining prices for photovoltaic modules and including a $3,000 rebate from the Government, the initial investment is not that great, say $16,000 for (solar electricity panels) an average home, or about one percent of the home’s value,” Mr Worboys said. “The levelised cost of electricity generated by that system over its lifetime would be around $0.16-$0.22 cents per kWh, which is about half the cost of buying power from Belco.
“We don’t need to wait for it to become cheaper it already is! Every home without solar PV is actually spending more on electricity than is necessary by not taking advantage of the technology. As far as space limitations go, the average home can generate all the electricity it needs from a 3kW photovoltaic system, which requires around 210 sq ft of unshaded space.”
Mr Worboys added: “We remain precariously reliant on imported oil for 99 percent of our energy requirements ... if the Strait of Hormuz is blocked by Iran over the coming weeks/months, this could restrict up to 17 percent of global oil supply, significantly pushing up prices for both electricity and transportation fuels in Bermuda.”
Belco said that it supported reducing reliance on imported fossil fuel (oil), noting that its “Energy Equation” for Bermuda called for renewable energy sources, including solar.
“We have set Belco’s own target of 20 percent of energy produced from renewable sources by 2020,” the company said.
“That said, renewable energy resources, such as solar and wind, provide only intermittent power; that is, only when the sun is shining or the wind is blowing.
“Even as large-scale and more small-scale renewables come online, Belco will continue to fulfill its responsibility to provide secure, reliable power, meeting the Island’s base load; likely this will be with conventional fossil fuel generation, although we are also exploring the liquefied natural gas as a cleaner alternative, as we believe could be promising.
“It is also worth noting that there is no commercially available wave or tidal power generation equipment; all such technologies are in the research and development phase.”
Liquefied natural gas has been converted temporarily to liquid form for ease of storage or transport. It’s estimated 23 percent of America’s energy comes from natural gas.
Belco said significant infrastructure would be needed to offload and store imported natural gas, and there would be costs associated with conversion of the generating plant.
Belco said it supported the introduction of large- and small-scale renewable energy installations, however it does not have responsibility for encouraging solar or other alternative energy use in Bermuda.
“That responsibility lies with the Bermuda Government, in particular with the Ministry of Environment, Planning and Infrastructure Strategy, as well as the Energy Commission, which regulates Belco, as it would any other energy provider.
“Bermuda Government also has authority over where such installations would be located, and Bermuda’s limited land mass makes location of large solar installations challenging.
“Nevertheless, Belco does encourage the move toward renewables, making public its ‘Energy Equation’ at public forums, at our Open House in 2010, in meetings with key stakeholders and online at www.belco.bm.”
Belco also established an Interconnection Policy for any residential and commercial renewable energy installations.
One of the commenters online, however, said: “We also need to get Belco to expand beyond 100 the number of household that can sell power back into the grid so people investing in these new technologies have a greater incentive than just cleaning up the island.”
Belco’s response was: “As we explained when announcing our Interconnection Policy, Belco established the initial threshold of 200 customers for interconnection in order to provide the opportunity to evaluate how the process is working.
“To date, 43 customers have connected to Belco’s transmission and distribution system. When the number of customers begins to approach the initial threshold of 200, Belco will re-evaluate based on a number of factors, including the ability of our transmission and distribution system to handle additional input.”
The Interconnection Policy is for those interconnecting their commercial or residential alternative energy installations with Belco’s transmission and distribution system.
They must meet certain technical specifications to ensure that they are operating safely, and that they don’t compromise the overall system.