Jamaican prime minister says our country must never depend on foreign energy

Prime Minister Andrew Holness has stated that subsiding energy is not the solution to the current energy crisis, but rather, moving away from being dependent on foreign energy sources, to become “energy independent” like the United States.

“Jamaica should never be dependent on foreign energy when the technology exists for us to use our God-given hot sun. The technology exists for it,” Holness declared while addressing the commissioning of 45-kilowatt floating solar panels at the Mona Reservoir in St Andrew this week.

The Opposition People’s National Party (PNP) has implored the Government to reduce the gas tax, but the Government has repeatedly insisted that embarking on such reductions will have negative fiscal impacts on the country.

Holness, on Wednesday, again gave his views on the call for subsidies in energy prices by adding a new element to the conversation, which is the need for the country to invest far more in renewable energy.

He made mention that, with the war in Ukraine and the subsequently increased energy prices, the solution that was promoted by many Jamaicans and some leading world figures was that the Government should subsidize the cost of energy.

“Some Governments have. We have been very cautious and very careful because Jamaica is a net importer of fuel, meaning we import almost, I would say, more than 90 percent of what we need,” he stated.

“So, it (fuel subsidy) is equivalent to Government just exporting the subsidy. You would get it, but ultimately, it’s just exporting foreign exchange, and when the price of energy goes up, we hear a sucking sound out of our balance of payment, because it is the foreign exchange that we would have earned from tourism, BPO (the business process outsourcing sector), that we would have to use to buy oil,” Holness indicated.

According to him, oil is an important commodity and there are no immediate options to substitute it.

“So, subsidies technically don’t work. All the subsidies do is just to further increase the outtake of foreign exchange from the country,” the prime minister suggested.

For the solution to the island’s energy challenges, Holness indicated that “The Americans have made it their national policy to be what they call energy independent”.

This, he stated, is rooted in their national security policy.

“They (the Americans) don’t want to be dependent on foreign oil,” Holness said, adding that Jamaicans should likewise not be dependent on foreign energy given its natural resources.

“Unfortunately, we are tied into an energy situation which we have established, which depends on oil and gas, but we have made the decision that we are going to diversify.

“That decision was made in 2009, and all new plants and energy generating capacity will go to renewable energy,” declared Holness. 

He asserted that the country will achieve that goal at “some point in time”.

In the interim, the prime minister said the Government’s focus will be on developing local energy.

He pointed to the 45-kilowatt floating solar panels at the Mona Reservoir as an example of a pairing of water and energy, which he said equates to the Government’s investment in local energy.

The floating solar panels are to bring millions of dollars annually in electricity savings to the National Water Commission (NWC).

Once fully completed, it is to help reduce the enormous cost of producing, storing, treating, and distributing water, which has contributed to the utility company being unprofitable over the y