Carlos Rymer

Sustainability, Life, and More…

Archive for the category “Renewable Energy”

Just Lead on Climate Change and They Will Follow

It is 2012, and international negotiations on climate change are still at an impasse largely because the world’s two largest economies and emitters (the United States and China) are demanding greater commitment from each other. Domestically, the United States is deeply gridlocked in politics over other issues to the point where climate change is no longer a priority to Congress. Meanwhile, China is moving ahead in securing dominance in the clean energy market. Previously, I argued that if the 2012 U.S. elections aren’t positive in terms of getting enough elected officials who understand the gravity of the issue, we may as well just turn to handing over the clean energy market entirely to the fossil fuel industry in its current form through specific economic incentives. Now, I want to answer the question of whether that’s truly necessary. Does the fate of the climate truly rest on the United States alone?

While it is largely believed that without the U.S. the international community cannot truly address climate change, current economic conditions point to the fact that this may not be entirely true. Yes, the U.S. is still the world’s second largest emitter of greenhouse gas emissions, and yes China is reluctant to commit to serious greenhouse gas emission reductions without a fair commitment from the U.S. Yet everything points to the fact that regardless of climate change as an issue, clean energy, energy efficiency, sustainable transportation, and everything else that can help address climate change are engines of economic growth that cannot and are not being ignored. This is why President Barack Obama so often claims that the nation “that leads on clean energy” will “win the future.” It’s no longer about whether this needs to be done; it’s becoming an issue of who is doing it the best and the fastest.

The U.S., while still uncommitted to tough greenhouse gas reductions, is leading in investments in clean energy just as other nations like Germany and China are gearing up to claim market share. Just as recently as 2010, China led the world in clean energy investments. The U.S., thanks to the Obama administration, has also seen investments rise to the point where it surpassed China in 2011. Pressure is clearly building to prevent clean energy jobs from being created elsewhere. It’s arguable that if other nations keep pushing, the U.S. would have no choice other than to follow through on making hard commitments to cut greenhouse gas emissions. It is this fact that gives fuel to the argument that the U.S. isn’t necessarily the decision-maker on climate change.

China, along with other countries, are arguably poised to lead the clean energy market. The challenge would be to not just lead in clean energy, but to make hard commitments to reduce greenhouse gas emissions to send a signal to their markets and the world that they are ready to claim a large share of a market that promises jobs and energy security. If China and other countries suddenly became manufacturing centers that supplied the their own markets and the rest of the world for a host of technologies ranging from solar, wind, geothermal, and even carbon capture, political pressure would lead the U.S. to do what it isn’t doing yet to ensure it doesn’t slip through the cracks in this 21st century opportunity to “win the future.”

It is up to China and other countries to leave behind the argument that they need a strong commitment from the U.S. to begin making hard commitments. If the U.S. decides to stay on technologies of the 20th century, that only helps them in winning the future and eventually making the U.S. a market for instead of a supplier of new technologies. There is in fact a way forward without U.S. gridlock, and it is up for grabs. Some countries are already aware, but they need to move faster and more aggressively if they want to truly claim the front seat of this wave of innovation and growth.

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To Save the Climate, Give ‘Em What They Want

In 1997, the international community came together to approve the Kyoto Protocol, an international treaty aimed at reducing greenhouse gas emissions. The goal was simple: to get started on the task to slow and eventually reverse climate change as the international community continued to discuss how to make further cuts in greenhouse gas emissions. Four years later, in 2001, U.S. President George W. Bush announced that the United States, then the world’s largest emitter of greenhouse gas emissions, would not participate in the treaty, deciding instead to encourage voluntary cuts in greenhouse gas emissions. It was that action that gave rise to the climate movement in the U.S., leading to strong reactions by businesses, colleges and universities, municipalities, and states to address global warming.

Fast forward to 2012, and things have changed quite a bit. From a technological perspective, we have made significant improvements in producing more fuel efficient vehicles, cutting the cost of solar power, making households and buildings more energy efficient, and increasing the capacity of wind, among other positive accomplishments. The international community has built an incredible movement fueled by people power, and many governments have decided to move forward on climate change on their own. Yet 2011 saw not just another record year for the global average temperature, but also another record year for greenhouse gas emissions globally. With developing countries continuing to grow fast, fossil fuels are being burned as fast as we can extract them from the Earth. We have seen what 1 degrees Celsius is already doing to the planet, from record warm weather in the Arctic to dust bowl like droughts. In spite of these realities, the international community has failed, year after year, to come up with a binding treaty that will get the job done.

Now, one source of hope is the technological revolution happening in the clean energy sector, especially in countries that have recently entered the clean energy race. Solar, for example, has seen its average cost drop by about 40% in the last few years as technologies have improved and supplies increased. Wind energy is becoming even more mature as output per turbine increases. Many countries are investing so heavily in clean energy that it is hard to argue that clean energy isn’t the future. Even the United States, under the leadership of President Barack Obama, understands that clean energy is a clear source of competitiveness that will determine “who will win the future.” Today, in spite of the global recession that dragged climate change outside of mainstream public debate, we are in a better position to do something about climate change. Yet we seem to be so far away from doing anything truly significant.

The reality is that the world will not take the necessary action to slow down and eventually reverse climate change unless the United States signs on with some significant weight. That clearly may not happen any time soon if Republicans continue to have it their way, even with Barack Obama in the White House. So time is running out, and we have to ask ourselves what else can we do to ensure that less fortunate people, countless other species, and future generations don’t pay the price that the fossil fuel industry is already incurring and will continue to incur as a result of human-induced climate change. Do we continue to wait until the right leadership is in place? Or do we think about what it is that the fossil fuel industry truly wants and is the reason why real action isn’t happening?

First, let me be clear about something I deeply believe in. I believe that most people want real action on climate change, and that over the years people have made themselves heard loud and clear. I also believe we have the capability to turn things around rather quickly, and that tomorrow, next week, next month, or next year, something big could happen that would sound a loud alarm across the globe and spur the international community to action on climate change. I still have strong hopes that we can come together and take on what is the biggest challenge facing humanity. But I have been this hopeful now for nearly a decade, and if trends tell the future, I’d rather not put the pain of the less fortunate, the diversity of species on Earth, and the opportunities of future generations on the line on hope alone. In the end, I think we have to do whatever it takes to prevent all of these things from happening.

So, do we wait or do we give ’em what they want? I think we can wait until the outcome of this year’s presidential elections in the United States, but if the outcome isn’t good, we need to think about alternatives. In my opinion, the only reason the fossil fuel industry has used it’s financial muscle to prevent action on climate change is because it wants to keep generating the large and rising sums of profit it generates today. As a clearly government-protected industry, it doesn’t want any competition. The few large businesses operating in the industry want to keep the energy market largely to themselves. So, if that’s it, could we consider as a last option to give them all the incentives necessary to transition them away from coal, natural gas, and oil and towards clean energy sources while keeping them as the majority shareholders of the energy market?

This sounds completely anti-competitive and unfair, and it is. It’s not the right thing to do at all. But at least it would ensure that we lessen the pain of the less fortunate, prevent massive extinction, and pass on a better planet to future generations. Personally, I don’t want to wait until 2020 and know that greenhouse gas emissions are still rising. At that point, it just may be too late. We can always make this first step strategically, and then focus on making sure that the energy market is truly competitive and fair. If we can do the latter now, I would be for doing so. But we haven’t been able to in the last couple of decades with everything we know we’ve done, and while still hopeful, I really think the 2012 elections will be a make or break moment on climate change. Let’s continue to work harder every day on doing what’s right, but let’s not forget that we still have an option when all else fails.

Are We Already Practically Cooked?

These days, it feels as if the climate debate has entirely fallen off the agenda (even Obama is not allowed to say “climate” anymore). So much has the debate shifted that it feels like we’re already practically cooked, waiting for the climate to warm up to levels that will simply reorganize Earth in a way that won’t be very comforting for anybody. We have gone from the days of Texas mega wind farm Ads on TV and the constant mention of climate and energy in the presidential campaign to a time where climate change is no longer in the agenda of U.S. politics. Obviously, this has thrown people off even as a global movement to address climate change has grown to record levels.

At the same time, we have experienced early warnings of the catastrophic effects severe climate change will bring to society. From floods of biblical proportions in Pakistan, Brazil, and Australia to massive snowstorms in the U.S. and Europe to record low winter sea ice extent in January, we are coming to grips with the reality of climate change. It is becoming all too clear that climate change is already affecting us directly in many ways, from rising food prices causing social instability to massive property losses due to increasingly frequent extreme weather events.

Given these realities, can we say that we are practically cooked? An optimist will rightly say we have to keep hoping, while a pessimist would say there’s nothing we can do. Yet the reality is very different from both of these views. While it may look hopeless, the fact is that a revolution is cooking. The world is realizing that clean energy technologies are not just good because they help fight climate change, but also because they provide real market stability, jobs, and hard currency. In spite of real economic problems, both advanced and emerging nations are joining a race that is set to intensify this decade. And if you’ve heard the trade debate lately, it has a lot to do with just that.

Nations are betting that whoever is the best at developing high-end clean energy products will win precious advantage this decade. That is why emerging nations like China are throwing a lot of money at clean energy and why the Obama administration opened an investigation into the matter, why Secretary Steven Chu wants the cost of solar energy to drop 75% by the end of the decade and Vice President Biden announced over $50 billion for new and improved high-speed rail lines, and why investments by major corporate players are now focusing a lot more on innovations that will change how we move around and use energy. From surging wind and solar manufacturing in China to the big bets automakers are making on EVs and plug-in hybrids, the race is clearly on.

My personal bet is that this race is set to intensify in dramatic ways, with investments surging over the next few years and game-changing innovations driving a shift away from fossil fuels and energy waste. While the question of whether this will be enough to slow and reverse climate change remains, it is clear that we aren’t practically cooked yet. In addition to this race, we will need to find ways to actually remove carbon from the atmosphere or adapt to a significantly warmer world, and my hope is that the fruits of this global race will create enough capacity for us to figure out how to do that in a way that is beneficial and does not change global ecological stability. In five years, we will know whether in fact we won’t be cooked by a fast warming planet in the future. Stay tuned for those news.

China: The New Big Hope on Climate Change

This past week, it became very clear that the United States will never get around to doing what it takes to lead on climate change. Last December, President Barack Obama went to Copenhagen promising the world the U.S. would cut its emissions 17% by 2020. That target by itself, while an important milestone, didn’t even come close to what the science says we need to do to avert catastrophic climate change. After tough health care and financial reform battles, Obama chose not to embrace a battle for climate change legislation, instead sending his own lobbyists  to work on “getting the votes” in the U.S. Senate. The bill in consideration, initially focusing on capping greenhouse gas emissions, got so watered down that it basically became an energy bill like the one passed in 2005 under the Bush administration, with no goals on cutting greenhouse gas emissions nor any renewable energy targets. All of this in a Democrat-controlled Congress that promised swift action to end our addiction to fossil fuels and spur a clean energy economy that creates hundreds of thousands of new jobs.

So, after more than 10 years of fighting and high public support for action on climate change since the days of Kyoto, the U.S. Senate has confirmed what we refused to admit. The United States will NOT lead on climate change, so we must not put our hopes on this nation. It seems that no matter what we do locally or globally, the ideology-based members of Congress will simply not agree to ensuring the U.S. economy doesn’t miss the great jobs and growth opportunity that clean-tech would bring. They will only agree to enriching the pockets of their fossil fuel friends, and ONLY with fossil fuels, as to them it seems that fossil fuel money is very different than clean energy money. As a result, it’s time to think not about nation-building through problem-solving, but about human survival through problem-solving. In other words, we have to think about how we can avert climate catastrophe at whatever cost instead of how we can do so at benefits to us (“us” being U.S. citizens). In the end, we’ll be better off averting climate catastrophe even if it’s not us who take the biggest piece of the clean-tech pie.

As it stands, the best hope we have right now to avert climate catastrophe is China. With all the press that people read about coal burning and ever-increasing consumption in China, it is the only country showing the incredible capacity we’ll need to muster to make the transition to clean energy. In only four years, China has become the world’s leader in wind and solar, beginning exactly from nothing. It took the developed world decades to get to where China has gotten in just a few years. On top of that, it takes China very little to make a decision that will strengthen their capacity to lead on clean energy, such as creating feed-in tariffs, investing twice as much on clean energy than the United States, and even creating a cap-and-trade system to price carbon directly. It can do this even while having one of the biggest supplies of coal. If what China has done in a few years is any indication of what’s to come, we MUST begin to put our hope on China as a major innovator in clean energy and, as such, the only leader that can and should be responsible for leading the world away from climate catastrophe.

To make this clear, let’s put out some numbers about how impressive China’s clean energy sector has been over the last few years. Five years ago, China wasn’t even up on the charts in the wind energy sector. In 2005, it approved major policy to drive growth of wind turbine manufacturing and wind energy installations. In 2009, it led the world in total installations of wind energy, installing a stellar 13.8GW of wind energy (compared to 9.9GW in the U.S.; China is expected to pass the U.S. in installed capacity in 2010). At the same time, it became the world’s top manufacturer of wind turbines, with 3 firms already in the global top 10. In photovoltaic (solar power or PV), it supplied nearly 40% of the world’s panels last year, making it the leader in PV manufacturing. In addition to these key technologies, it has broken it’s own goals in solar hot water, biomass, and hydro consistently. It is also building the world’s largest and most advanced high speed rail systems, and has one of the world’s most ambitious programs to manufacture electric vehicles, having its own target of becoming the world’s leader in just three years. A very long walk for such little talk.

We can’t fool ourselves. China is clearly today’s most capable nation of turning this crisis into an incredible opportunity. While the U.S. still has incredible capacity, its gridlocked politicians will never let it pick up momentum, especially now after everything indicates politics will just get worse after November 2010. In spite of the reality that there are key issues in relation to China’s jump into clean-tech (such as quality), these are gradually going away as China’s clean-tech sector matures. It is time for the world’s attention to shift away from the U.S. and onto China when it comes to climate change. Chinese authorities know they will lead, and it is why their game has been very simple: obstruct international negotiations that could lead to the U.S. being more aggressive on clean-tech. This buys China time to create its industries, fix any issues they might have, and drive them to incredible growth that can not only meet domestic clean energy targets, but also easily take the rest of the world on a transition to clean energy, EVs, high-speed rails, etc.

The sooner we admit this, the sooner the rest of the world can shift its attention to China, putting pressure on its authorities to drive the clean-tech bandwagon fast enough to cut greenhouse gas emissions on a scale that would prevent Greenland’s melting, the Amazon’s burning, and the Arctic’s disappearance. For us, it’s no longer about whether we will lead. It’s about whether we will survive.

Can Obama Succeed On Clean Energy?

Today, Senators John Kerry and Joe Lieberman, joined by a strong coalition of business groups and NGOs, unveiled “comprehensive” climate change and clean energy legislation and emphasized their confidence in getting it passed during the current Congress. Immediately afterwards, President Obama applauded the Senators for introducing legislation that would spur clean energy innovation and ensure the U.S. meets its climate change pledge to the international community under the Copenhagen Accord. Regardless of how anybody may feel about this (i.e. too late, too weak), it is a major milestone. We’ve marked off the checklist for everything that needs to be done to pass a climate bill, except getting the Senate to pass one. Now, it is up to President Obama to fight hard to get climate change and clean energy legislation passed. Can he do it?

Ever since he signed health care legislation over a month ago, President Obama has been wavering among a host of issues ranging from climate change legislation to wall street reform to nuclear proliferation. Unfortunately, he hasn’t decided to choose or two of these priorities and go with them as aggressively as he did with health care reform. What’s worse, he’s failing to live up to one of his core principles he repeatedly mentioned throughout his campaign for health care reform, and that is that his choice to act wouldn’t be influenced by “politics or the polls,” but instead by what “is the right thing to do.” With the upcoming Congressional elections, it seems that President Obama is being influenced more by the polls than “the right thing to do” as he has chosen not to fight aggressively for anything. A great example is his rather short period of campaigning for wall street reform, which lasted a couple of weeks to be left to Congress again.

If President Obama wants to succeed on climate change and clean energy legislation, he will have to push it as hard as he pushed health care reform. So far, President Obama hasn’t dedicated any town hall meetings or domestic visits to climate change and clean energy legislation. He’s only spoken about it during a few times during his weekly addresses and when he announced lifting the ban on offshore drilling in many areas. A quick search through the White House website for health care yields 616 entries as of today, while for energy and the environment there are 64 (that’s roughly 10%). Clearly, if President Obama wants to succeed on climate change and clean energy legislation, he’ll have to campaign more aggressively for it to tip the political balance towards getting the necessary votes in the Senate to pass the strongest bill possible.

Furthermore, he will have to come up with the kind of language that will resonate with people across the country. When he campaigned for health care reform, he spoke of insurance industry abuses, unreasonable premium hikes, and a ballooning federal deficit, all of which were key messages that resonated with people across the country. However, when President Obama speaks of climate change and clean energy, he talks about innovation, leadership, and job creation, failing to emphasize the loss of jobs to other countries, the impacts of floods, droughts, and rising temperatures that are not uncommon across the country, and the damage that fossil fuels incur on the environment, health, and the pockets of U.S. citizens. It is  important to emphasize how climate change and clean energy legislation will spur new industries and create new jobs, but it is also important to emphasize how action will benefit citizens directly, just as he did with health care.

This is perhaps the best time to get it right. The BP oil spill and the coal mine disasters have exemplified our need to eliminate our dependence on fossil fuels altogether, while our continued loss of clean energy manufacturing jobs to other countries will continue to make it harder to fight the high unemployment rate. We all witnessed how President Obama mustered public support to pressure Congress to act on health care. There is no doubt it can happen again for climate change and clean energy legislation, but it will require President Obama to “do the right thing,” step up to the plate, and campaign aggressively for legislation before campaigning for the Congressional elections erases all chances to get anything done this year. This one is just as up to the Senate as it is to President Obama.

Our Bet On Clean Energy Innovation

The time to decide on a strategy to remain as #1 is slowly coming to an end. The U.S. has seen a jolt in economic activity as a result of the Recovery Act, but it’s all too clear that this alone won’t bring the U.S. economy back to sustainable growth over the long-term. We have entered a period where huge deficits are in order and the private sector won’t make a comeback where it used to prosper. Instead, something new must arise to fill the gap in economic activity after the U.S. government can no longer sustain the economy by issuing debt. The Obama administration has repeatedly said that it is “confident” that clean energy is the only sector that can fill that economic gap and pave the way to lower deficits, a higher trade surplus, and a better overall fiscal status.

Until very recently, the climate movement in the US, largely led by youth, was the main reason why clean energy had a future. The idea was that we had to develop clean energy to reduce our greenhouse gas emissions and slash our oil bill, which was financing “terrorists” and making the trade deficit worse. The youth climate movement was successful in making it clear that we better develop a clean energy economy to also create the jobs of the future and become the leader in this all-too-important sector. So today, the Obama administration understands that developing clean energy is all about creating jobs in the US and cleaning up the Federal books (though more importantly it’s about preventing runaway climate change). Whether “clean energy” means wind, solar, and geothermal or nuclear, clean coal, and biofuels is another debate. We know that nuclear, clean coal, and biofuels would not produce enough jobs compared to wind, solar, and geothermal, so I assume the outcome will be a mix, as Obama actually intends in his strategic political plan.  However, Obama may be overoptimistic in thinking that the US can win the clean energy race under his plans.

First of all, unlike other industries of the past that generated big economic growth (think cars, Internet, IT, etc.), clean energy is something the entire world knows about and is working hard to get its hands on. While it takes Washington years to make any decision on clean energy, Asia and Europe have already been racing to develop the best clean energy technologies in the world. Out of the top 10 clean energy companies in the world, only one or two are from the U.S., while increasingly more and more Chinese clean energy companies are going public. That’s because China made the decision to take this market a few years ago, and it’s already succeeding.

According to the Apollo Alliance, a US labor organization that promotes a clean energy economy, the US already imports over 70% of all components for renewable energy projects. Most of this manufacturing is happening in China, which has already become the world’s largest manufacturer of wind turbines and solar components. With an economy that’s less than half the US economy, China is already spending more than twice as much than the US on clean energy, and plans to ramp it up further. And while experts have believed that China would focus on manufacturing while the US focuses on innovation, China is spending big on creating breakthrough technologies as well. Already, it is funneling $1 billion into the world’s first clean coal power plant that will capture carbon dioxide, and only because there’s less red tape in China to begin construction of such a plant.

The Breakthrough Institute has analyzed how much the U.S. would need to spend in order to remain competitive in this sector and truly create the technologies that will lead the market. According to its analysis, the U.S. will spend about $175 billion over the next five years on clean energy, including R&D and tax incentives. On the other hand, China alone plans to spend $397 billion, leaving the other “Asian Tigers” out. This leaves the U.S. at a significant disadvantage, making it highly unlikely to create the leading clean energy technologies that can fill it’s economic gap. Even passage of a climate bill in Congress, which would certainly put all serious action until at least 2014, would be insufficient to close this gap.

In the end, the numbers do show that the Obama administration’s bet on clean energy will probably not hold out. Asia will end up taking all the manufacturing jobs and exporting their technologies to the U.S., and the U.S. will have to look elsewhere for innovation in order to fill the economic gap. And while cloud computing has its promises, it will not create a market big enough to fill the gap. So, I wouldn’t bet on clean energy making it for the U.S. economy, even if there was a change in Washington. It is time for a drive in innovation in a variety of sectors, not just clean energy. It’s really the only way out.

Author’s note: I didn’t make any mention of EVs and high-speed trains because they’re in the transportation sector. While they are clean technologies, I wanted to focus on clean energy. Readers should know that the US is also behind in these other clean techs.

¿Son Las Plantas a Carbón La Solución Definitiva?

coalEl Partido de la Liberación Dominicana (PLD) se ha sumado a los que fuertemente apoyan plantas a carbón como solución a la crisis energética que enfrenta República Dominicana. En su propuesta, el partido en poder quiere invertir U.S. $2 billones (R.D. $70 mil millones; 5% del PIB en el 2007; 20% de la deuda externa) para instalar 1,200MW de capacidad a carbón. Con estas dos plantas, y una estimación de operación anual de 85%, se podrá generar aproximadamente 8,900 GWh, lo cual representaría alrededor de 60% de la actual demanda (más o menos 14,000GWh, usando datos del 2006). Sumando las pérdidas de aproximadamente 40% que existen en la red eléctrica, el carbón aportaría aproximadamente 5,300 GWh, o 38% de la demanda actual. Con un precio de U.S. $0.05 por kWh, se generarían U.S. $445 millones anualmente, por lo que la inversión se pagaría en 5 años, dependiendo de la tasa de interés. Además de esto, los consumidores o el gobierno tendrían que asumir las perdidas en transmisión y distribución, que ya cuestan anualmente alrededor de U.S. $500 millones según el subsidio que el gobierno tiene hoy para esos términos.

Asumiendo que el precio de generación con petróleo esta a U.S. $0.15/kWh, esto representaría un ahorro de aproximadamente U.S. $900 millones anuales. Por lo tanto, en el corto plazo, las plantas a carbón representarían un ahorro significativo, aunque todavía estuviéramos perdiendo U.S. $500 millones anualmente por ineficiencias en el sistema (perdidas técnicas y no técnicas). Claramente, la reducción en el precio de generación es necesaria y siempre lo ha sido. Estas plantas pudieron ser instaladas hacen años, cuando el carbón mineral también estaba barato como hoy. Mientras que esto quizás pueda ser una solución al precio de generación en el corto plazo, no hay ninguna garantía que el precio se mantendrá bajo en el mediano y largo plazo, y ese es el problema de las plantas a carbón como una solución conjunta a la crisis energética de la República Dominicana.

El problema es que República Dominicana no tiene influencia sobre el mercado internacional del carbón mineral, el combustible fósil que mas emite dióxido carbono cuando quemado. Lamentablemente, el dióxido carbono es el gas que está causando el cambio climático, lo que ya está afectando a República Dominicana y debe ser combatido por los países desarrollados, según el Presidente Leonel Fernández, quienes causaron el problema con el uso masivo de los combustibles fósiles.

Con la nueva administración ejecutiva en Estados Unidos (Barack Obama), está muy claro de que el mundo comenzara a reducir sus emisiones de dióxido carbono. Esto implica que la oferta del carbón mineral tendrá que disminuir en el futuro significativamente, probablemente elevando el precio de este producto así como el precio del petróleo hoy está subiendo por la incapacidad de mayor producción. Como República Dominicana no controla el mercado internacional ni cuenta con carbón mineral, tomamos un riesgo significativo a volver a la misma situación de hoy (precios altos de generación eléctrica) porque puede que el precio del carbón suba en el mediano plazo (la siguiente década). Por lo tanto, es muy probable que estas plantas no sean la solución definitiva como muchos dicen, aunque es una solución en el corto plazo siempre y cuando podamos recuperar la inversión en muy poco tiempo (5 años).

Para el largo plazo, necesitaremos usar fuentes de energía que no dependan del mercado internacional. Como los alimentos, la energía es una necesidad básica y debe de estar segura para el largo plazo. No podemos dejar la energía en manos de la comunidad internacional porque no contamos con influencia suficiente para asegurar esta necesidad fuera del país. Por esta razón, debemos mirar a otras fuentes alternas que podamos producir domésticamente y que ya hoy son viables. Aunque la percepción de muchos es que las energías alternativas hoy son muy caras, esa percepción es vieja ya que los precios de estas han venido disminuyendo rápidamente, con la excepción de la energía solar fotovoltaica.

Por ejemplo, le energía eólica se vende mundialmente a precios entre U.S. $0.03-0.10 por kWh, y mientras no sobrepase 20-30% de la demanda, su variabilidad no causa ningún problema a la red nacional. En el futuro, con tecnologías de almacenamiento, esta podría aportar aun más a la red nacional sin ningún problema. Esta tecnología ya se usa masivamente en Dinamarca, España, Alemania, Estados Unidos, y recientemente hasta en China. Afortunadamente, el país cuenta con un gran potencial eólico. También, existe la electricidad termosolar (además de los calentadores), que se vende a U.S. $0.10 por kWh y podría bajar más en el corto plazo. Esta tecnología tiene un menor problema de variabilidad porque cuenta con su propio almacenamiento, y ya se está aplicando comercialmente en España, Estados Unidos, y varios otros países. Además, en República Dominicana, contamos con un gran potencial solar. Adicionalmente, existen otras que podemos explorar en nuestro país, como la geotérmica, la eólica marítima, y la eficiencia energética (la que nadie considera como barata aunque es la mejor opción).

En el anteproyecto de ley que el PLD ha sometido al Congreso, se menciona que ha habido “una falta de inversión privada,” por lo que el gobierno debe tomar acción. Pero esto indica que el PLD está mal informado de sus propias acciones, ya que luego de haberse aprobado la Ley de Incentivos a las Energías Renovables y Regímenes Especiales, la Comisión Nacional de Energía ha anunciado inversiones que superan los U.S. $2 billones en varios proyectos, incluyendo energía eólica, fotovoltaica, biomasa, hidroeléctricas, entre otras. Claramente, la falta de inversión privada existía antes de que existiera esta ley, la cual obliga el uso de toda electricidad producida de fuentes renovables y exonera todo tipo de impuestos. Por lo tanto, la ley ofrece un incentivo donde no existen barreras a la inversión privada. Anteriormente, no había confianza en el sistema para invertir en energías convencionales, pero ahora existe confianza para invertir en las renovables y la eficiencia. Los que están enterados de esto saben que se están desarrollando varios proyectos con buenas expectativas.

Teniendo esto en cuenta, entonces se debe de estar de acuerdo, así como lo propone el Consejo Nacional de la Empra Privada (CONEP), que se deben evaluar las varias opciones que tiene el gobierno. Por un lado, se puede invertir U.S. $2 billones en dos plantas a carbón. Por otro lado, se puede hacer disponible U.S. $1 billón como incentivo a inversiones privadas en energías renovables a costo competitivo (ósea de entre U.S. $0.05 y $0.10 por kWh, que es razonable teniendo en cuenta que el riesgo para el largo plazo es cero), lo cual atraería entre U.S. $3 y $5 billones, como es el caso en general con incentivos en otros lugares del mundo, incluyendo países en desarrollo.

Con U.S. $4 a $6 billones, se podría no tan solo invertir en mas de 2,000MW de energía eólica o 1,000MW en electricidad termosolar, pero también se podría invertir en eficiencia energética y en el sistema eléctrico para reducir las pérdidas. El restante U.S. $1 billón se podría invertir en una planta a carbón para temporalmente solucionar el problema, algo que creo que el PLD quiere lograr por el compromiso del Presidente Leonel Fernández a resolver el problema de los apagones antes de que termine su administración. Por otro lado, se podría disponer U.S. $2 billones para atraer suficiente inversión privada para no tan solo incrementar la oferta en el corto plazo, pero también para eliminar el problema de las perdidas eléctricas, ya que quizás contaríamos con inversiones privadas de hasta U.S. $8 billones o mas en el sistema.

Este mecanismo no tan solo seria innovador porque usaría los crecientes mercados de energías renovables y eficiencia energética, pero también reduciría el precio de generación a niveles razonables, eliminaría las perdidas en el sistema, y eliminaría nuestras emisiones de dióxido carbono bastantemente, sumándonos al compromiso mundial de combatir el cambio climático. Además, tales acciones crearían miles de nuevos empleos en un tiempo cuando los necesitamos y atraería nuevas inversiones en una nueva industria para manufacturar tecnologías nuevas en el país. Dos plantas a carbón no tiene nada de innovación, pero un mecanismo conjunto entre el gobierno y el sector privado para garantizar lo que sería la solución definitiva (a corto y largo plazos) seria innovador, algo que este gobierno dice tenemos que ser.

En tiempos como estos de presión política, los líderes gubernamentales no deben encerrarse y hacer lo primero que se lo pongan en la mesa como solución. Se debe pensar con miras al futuro, teniendo en cuenta que las cosas que hagamos hoy podrán tener consecuencias negativas o positivas dependiendo de lo que sea. La solución energética debe ser aquella que mas aportes positivos tenga. Debe de generar nuevos empleos, atraer nuevas inversiones (como lo está haciendo la Ley de Incentivos a las Energías Renovables), reducir el costo de la generación eléctrica, incrementar la oferta, y sobretodo eliminar las perdidas eléctricas técnicas y no técnicas. Esa sería la solución definitiva. Las plantas a carbón pueden ser una parte a tal solución, pero no conforman la solución definitiva y tampoco toman parte de una estrategia creativa e innovadora.

En Costa Rica, existe un plan de eliminar la dependencia de los combustibles fósiles. Ese país ha aprovechado la disponibilidad de agua para generar la mayoría de su electricidad a partir de la hidroeléctrica, y cuenta con varios otros proyectos de energías renovables y combustibles renovables para el transporte. En Costa Rica no tan solo se entiende que se debe hacer algo sobre el cambio climático; también se entiende que la energía es algo que no se puede poner en las manos de la comunidad internacional. Esto lo sabemos por las presentes crisis financiera, de alimentos, y energética que vivimos en el mundo. Países como República Dominicana son vulnerables a estas, y cuando se trata de necesidades básicas, es mejor asegurar su producción domestica que contar con la comunidad internacional. El PLD y el Presidente Leonel Fernández cuentan con varias opciones para resolver la crisis energética. Una evaluación real, analizando lo bueno y lo malo de cada opción, sería un acto que demostraría responsabilidad a la sociedad Dominicana. No se espera nada menos que esto del PLD.

Plantas a Carbon No Solucionaran Problemas Energeticos

coalLa República Dominicana sufre de un problema energético que nunca ha podido ser resuelto. Los apagones que afectan al país reducen la actividad económica, perjudicando la confianza proyectada al sector privado y empeorando la calidad de vida de los Dominicanos. En este año en particular, los apagones han afectado al país de forma dramática, causando protestas sociales y reclamaciones del sector privado. El problema energético se ha intensificado este año por el incremento en el precio del petróleo, que llego a U.S. $140 por barril, forzando al gobierno a subsidiar al sector eléctrico con un record de alrededor de U.S. $1 billón (R.D. $35 billones). Esto no tan solo causa un problema en el déficit comercial, ya que causa un incremento en el valor de las importaciones, pero también causa un problema en los gastos sociales del gobierno, ya que no se puede invertir lo deseado en programas sociales.

El problema energético en República Dominicana se debe a varios factores. Primero, las perdidas en la transmisión y distribución de la electricidad siempre han sido altas, aunque han bajado un poco en los últimos años (se sitúa ahora alrededor de 35-40%). Estas pérdidas se deben al robo de la electricidad y la ineficiencia del sistema de distribución, el cual causa perdidas tan solo en la resistencia y la dislocación de la electricidad.

Segundo, existe una deficiencia en la oferta energética porque se han creado contratos con empresas privadas que no incentivan la inversión privada en el sistema. Esto ha causado que la oferta no incremente sustancialmente en el sector privado, mientras que la demanda aumenta anualmente. Gran parte de la oferta que ha entrado a la red nacional eléctrica ha sido aportada por el gobierno. Con la nueva Ley de Incentivos a las Energías Renovables, el sector privado está invirtiendo en capacidad nueva que entrara al sistema nacional, pero el problema no será resuelto inmediatamente ya que toma tiempo a que se estructure el sector de energías renovables.

Finalmente, la demanda en el país ha incrementado significativamente, lo que indica que no ha habido ningún esfuerzo para disminuir el consumo de energía vía la eficiencia energética. Fue en este año que se lanzo un programa para mejorar la eficiencia energética, pero esto tampoco lograra resultados inmediatos.

Recientemente, se ha debatido lo que se debe de hacer para solucionar la crisis. El Consejo Nacional de la Empresa Privada (CONEP) ha propuesto crear un fondo para reducir el robo y pagar la electricidad ya servida. La propuesta también incluye la re-negociación de los contratos con las empresas privadas, la conexión de todos los usuarios en el país con contadores, la re-privatización de las EDEs. Claramente, esta propuesta reconoce que el problema energético del país está en las perdidas eléctricas, por la mayor parte.

En otra propuesta, el geólogo Osiris de León de la Academia de Ciencias plantea que el gobierno invierta hasta U.S. $2 billones en plantas a carbón para elevar la oferta energética. Aunque esto es algo preferible, hay varios problemas con tal propuesta. La primera es que eso requerirá de un incremento significativo en la deuda externa, ya que el gobierno no cuenta con los recursos financieros necesarios. Segundo, tal propuesta ignora las grandes pérdidas eléctricas en el país, lo que significa que alguien tendrá que seguir pagando la tarifa eléctrica de las pérdidas de hoy y las que podrían venir si se suman plantas de carbón con gran capacidad a la red nacional eléctrica. Finalmente, y en esto se basa el resto de esta opinión editorial, tal plan ignora el futuro mundial del carbón mineral, el cual no tiene un lugar en un mundo que quiere reducir las emisiones de dióxido carbono.

Desde hacen años, la administración de la Corporación Dominicana de Empresas Eléctricas Estatales (CDE) ha querido construir plantas a carbón con capacidad de 1,200MW como forma de solucionar el problema energético. Como Osiris de León, la administración de la CDE ha pensado de que si se aumenta de forma sustancial la oferta, entonces no habría ningún problema energético en el país. Políticamente, quizás esto sea verdad, ya que los consumidores quizás pagarían un menor precio en el corto plazo y tendrían un abastecimiento de 100% de la demanda. Esto sería algo que el pueblo Dominicano felicitaría y quizás retribuiría con votos en el futuro.

Realísticamente, esto no será ninguna solución al impacto económico que las perdidas eléctricas tienen en el país, ya que el gobierno todavía tendría que absorber el costo de estas pérdidas y el de las plantas, que nunca serán de U.S. $450 millones, como pensaba la administración de la CDE cuando fue ofrecida con plantas de una empresa China. Como consecuencia, el gobierno tendría que mantener los niveles corrientes de gastos en el sector social ya que todavía tendría que intervenir económicamente en el sector eléctrico. Es el sector social (la educación, la salud, programas para la juventud y la mujer, protección social, etc.) el cual más necesita del gobierno y el más visible en la sociedad Dominicana.

El otro problema del carbón mineral es que, como el petróleo, hay que importarlo y por lo tanto depende de la situación internacional. El precio del carbón mineral, así como el del petróleo, depende de un mercado internacional en el cual los mayores consumidores, y por lo tanto los que mayor influencia tienen en el precio, son grandes países como Estados Unidos, China, la Unión Europea, y India. Estos son los mismos países que producen y consumen casi todo el carbón mineral anualmente en el mundo. Esto quiere decir, que así como el petróleo, estos países son los que controlan el precio del carbón mineral.

En los Estados Unidos, la nueva administración de Barack Obama ha anunciado que su país está comprometido a enfrentar el cambio climático. Con esta declaración, los Estados Unidos se suma al resto del mundo, especialmente la Unión Europea, en la lucha contra el cambio climático, el cual amenaza afectar significativamente a países vulnerables como República Dominicana. La única forma de enfrentar el cambio climático es incrementar el precio de los combustibles fósiles, especialmente el carbón mineral. Adicionalmente, con la ausencia de tecnología que prevenga la emisión de dióxido carbono causado por la quema del carbón mineral, esto significara que habrá una oferta mundial que disminuirá significativamente con el tiempo, incrementando el precio del carbón así como ha pasado con el petróleo.

Si este es el futuro que la comunidad internacional ha decido para el carbón mineral, entonces no cabe duda de que plantas a carbón en República Dominicana no solucionaran definitivamente el problema energético que sufre el país. Si decidimos instalar plantas a carbón en el país por razones políticas (las ventajas políticas de esconder el problema al publico Dominicano), no tan solo estaríamos incrementando nuestra deuda externa para que los jóvenes tengan que pagarla en el futuro con impuestos, también estaríamos ignorando el problema de las perdidas energéticas y el gran potencial que tenemos de atraer inversiones en la producción y manufactura de energías renovables en tiempos cuando tal sector está en pleno desarrollo agresivo en el país.

La solución a la crisis energética es administrativa. La CDE y las EDEs, con apoyo del gobierno, tienen que enfrentar las perdidas eléctricas en el sistema. Estas agencias gubernamentales-privadas deben trabajar conjuntamente para elaborar un plan que reduzca las pérdidas de 35-40% a 5-10% en cuatro años. Se debe aplicar la ley que criminaliza el robo de electricidad y conectar todos los usuarios de electricidad a la red nacional con contadores.

También se debe modernizar el sistema de distribución con miras a reducir el robo y las perdidas en resistencia eléctrica. Como propone el CONEP, también se debe re-negociar los contratos con las empresas privadas y debe de haber una mayor supervisión del gobierno en las plantas privadas para prevenir problemas y la cancelación de la generación eléctrica. Finalmente, se deben efectuar los planes para ahorrar energía masivamente y entrar a la red nacional eléctrica gran capacidad de energía renovable aportada por campos eólicos, plantas solares-termales, geotérmicas, hidroeléctricas, y otras. Esta es la única solución real al problema energético del país. Las plantas a carbón forman una solución reactiva y costosa que no solucionara los problemas energéticos en nuestro país.

Planta de Carbon Mineral en Haina No Tiene Justificacion

coalCon recursos abundantes de viento, luz solar, y tierra, y una Ley de Incentivos a las Energias Renovable que ya ha atraido mas de US $2 billones en proyectos de energia eolica, energia solar termica, produccion de modulos solares, etanol, y biodiesel, se habia supuesto en la Republica Dominicana que nuestro mensaje a los combustibles fosiles (petroleo, carbon, y gas natural) era claro. Con todo el movimiento que se esta viendo en la surgiente industria de energia renovable y el paro del proyecto de carbon de 1,200MW que la CDEEE queria implementar, es claro que el pais ha entendido que quiere un futuro energetico donde nuestras necesidades energeticas sean suplidas domesticamente, sin contribucion al cambio climatico, y con la creacion de cientos de miles de nuevos empleos. Pero recientemente, la empresa Korea Electric Power Corp (KEPCO) termino un acuerdo con la generadora electrica de Haina para construir una planta a base de carbon mineral de 240MW por un valor de US$500 millones, lo cual es plenamente una contradiccion al interes nacional de crear trabajos y combatir el cambio climatico mediante la creacion de una industria de energia renovable dinamica.

Es interesante analisar esta inversion del punto de vista economico de la empresa Koreana. Sin discutir el impacto del carbon mineral en las emisiones de gases de efecto invernadero en el pais, es facil ver que esta es una inversion sin justificacion economica. La Ley de Incentivos a las Energias Renovables ofrece un marco legal para las energias renovables que les da prioridad sobre cualquier otra fuente de energia. En otras palabras, la red electrica del pais y los distribuidores de combustibles tienen como obligacion aceptar energia (electricidad o combustible) proveniente de recursos renovables antes de aceptar energia derivada de combustibles fosiles. Como va la situacion con las energias renovables (tomando en cuenta que el gobierno aun no ha aprobado el reglamento a la Ley de Energias Renovables), la matriz energetica del pais sera abastecida con energias renovables en 10-20 años.

Poco despues de la aprobacion de la Ley de Energias Renovables, inversiones superando los US $2 billones fueron anunciadas, con una capacidad electrica de 1,600MW y una produccion de combustibles de mas de 100 millones de galones anuales en diversos proyectos. Hoy, la capacidad electrica del pais, basada en gran parte en petroleo, es de alrededor de 3,500MW, mientras que el consumo de combustibles es alrededor de 900 millones de galones anuales (incluyendo la gasolina, el gasoil, y el gas natural). A este ritmo de inversion en energias renovables, es razonable concluir que las energias renovables son el futuro de la matriz energetica del pais y que sacaran a los combustibles fosiles de nuestra matriz energetica. Si la empresa Koreana entendiera esto, no veo como creen que van a recuperar su inversion cuando requieren 20 años de operacion.

Alrededor del mundo, desde los Estados Unidos a Malasia, le gente estan demonstrando su oposicion al carbon mineral por su contribucion al cambio climatico (que ya esta afectando a la Republica Dominicana y puede eliminar nuestra industria turistica con la subida del nivel del mar), su impacto en los ecosistemas montaneros de donde se extrae el carbon mineral, y el maltrato de los empleados de empresas de carbon mineral (quienes tienen que trabajar largas horas en condiciones gravemente peligrosas). En la Republica Dominicana, debemos aclarar nuestra oposicion al carbon mineral tambien. Debemos organizar demonstraciones, dar a conocer sobre los impactos negativos del carbon mineral a la poblacion mediante la prensa y el Internet, y pedirle a nuestro gobierno que apruebe legislacion que impida la construccion de plantas electricas basadas a carbon mineral.

Los argumentos relacionados a los bajos precios del carbon mineral ya no pueden dominar la discusion sobre la matriz energetica. El precio del carbon ha subido por mas de 50% en los ultimos anos, de US $55 por tonelada a mas de US $100 por tonelada. Ademas, el precio que tiene el carbon mineral en su quema por la emanacion de dioxido carbono es muy alto. Las tormentas tropicales Noel y Olga y la sequia que asota al pais son advertencias de lo que ha de venir.

Con nuevos anuncios de los cientificos mas reconocidos del mundo de que las masas de hielo se estan derritiendo mas rapidamente de lo pensado y que el mundo debe moverse mas rapidamente para eliminar las emisiones de gases de efecto invernadero, es claro de que el cambio climatico lleva una urgencia dramatica que nos impide seguir usando combustibles fosiles sin consecuencias catastroficas. A riesgo esta nuestra industria turistica que se basa en nuestras costas y nuestro sector agricola. Como uno de los paises mas importantes del Caribe, es nuestra obligacion enviar un mensaje al resto del mundo de que nosotros queremos evitar las consecuencias del cambio climatico y desarrollar una industria de energia renovable que nos lleve hacia el desarrollo sostenible.

Como ciudadanos, es nuestra obligacion asegurar de que nuestro pais envie este mensaje. Debemos comunicar este mensaje a la poblacion y asegurar de que el gobierno Dominicano impida la construccion de proyectos de carbon mineral en el pais. Tambien es nuestra obligacion asegurar de que el gobierno avanze con sus promesas de aprobar el reglamento que regira las energias renovables bajo el marco legal de la Ley de Incentivos a las Energias Renovables. Con el precio del petroleo superando los US $115 por barril, no tenemos tiempo que perder. Tenemos que movernos rapido en el desarrollo de una industria de energia renovable que pueda crear muchos empleos, proveer nuevas oportunidades a nuestras areas rurales, y asegurar nuestro crecimiento economico continuo y equitativo.

Dominican Republic Set To Lead on Renewable Energy

cneOriginally published in It’s Getting Hot In Here.

While there is a lot of debate about a national renewable energy standard and more than half of the states have some kind of RPS, where does the rest of the world stand on renewable energy targets? As an Hispanic, I’m very interested in what Latin America and the Caribbean do about global warming, not just because we need to show leadership to northerners, but also because this is our future. Most countries in Latin America depend on oil imports, and most of them are also already being and will be impacted by global warming. So, not surprisingly, we are seriously trying to be on top of this.

Everybody knows about what Brazil is doing with ethanol, but what about other countries in Latin America? And what does the future hold for renewable energy in this region. I’m from the Caribbean, specifically the Dominican Republic, and I’m very involved in what’s happening in that country and elsewhere around the region. Since 2005, I’ve been visiting the country quite often, helping found an organization that promotes sustainable development and now looking into renewable energy ventures in that country. So, what is the Dominican Republic doing about global warming? In short, it’s emissions are going up, but it has a renewable energy standard that says 25% renewables by 2025. Let’s take a closer look at the details.

Last April, the President of that country, Dr. Leonel Fernandez, signed a renewable energy law passed by the Congress. After 6 years of meetings and drafts and building support, it finally passed. Within a year of the idea that the law was going to definitely pass under Fernandez’ administration, a Spanish company invested E$100 million in solar cell production, wind companies announced over 400MW of planned installations, the Brazilian company Infinity Bio-Energy announced an investment of $200 million in a large ethanol plant (since the country has a lot of sugarcane), and lots of small solar and wind energy subsidiaries have been set up in the country. With over 25,000MW of wind potential in less than 3% of the land (over 60,000MW in 9% of the land) and an infinite supply of sunlight (sunny Caribbean), the potential is there for the country to meet all its energy needs from renewables.

Before specifying what the law does, it’s important to mention the fact that the government is committing to paying for what the incentives described below on top of all the problems the country has. Among them are an unemployment rate of 15%, a per capita GDP of just over $8,000 (though growing at 10%), some 25% of the population in poverty, a relatively high crime rate, congestion in large cities, high energy costs and power blackouts, many urban areas without potable water or paved roads, and an education system that is not near the best it can be. Of course, high energy costs justify taking this action because it will create large energy savings in the future, but the investments required to incentivize renewable energies are coming out of the pockets of citizens of the Dominican Republic.

So, what does this law do exactly? First of all, it removes all taxes from all equipment, sales, and income for at least 10 years. Clearly not the case in the United States or elsewhere. Second, it pays up to 75% of the cost of installing solar or wind in homes or community co-ops. Again, higher than the incentives in the United States or elsewhere. And third, but most important, it places a feed-in tariff! That’s right, utility producers receive a premium equal to the estimated externalities of fossil fuels for the renewable energy they produce. Essentially, they’re putting the incentives that makes solar work in Germany. But, of course, this country is sunnier, so the potential for higher installations is clearly there.

On the fuels side, they have lots of incentives for ethanol and biodiesel production, including the 100% tax exemptions. Brazil and Chile are therefore very interested in producing ethanol in the country. The law mandates that all gasoline sold in the country be blended with a 10% mix, with higher blends to come. While there may be transformations coming to the mobility sector of that country that will make ethanol unnecessary (and thus solely for tax-free exports to the U.S.; yes, CAFTA works for this), this is pretty impressive. There are several experimental plots that will be producing biodiesel from Jatropha and other plants. And the President joined investors last week at the Clinton Global Initiative to announce plans for biodiesel production in Haiti (to promote growth, create jobs, etc.).

Now, isn’t this enough to justify the U.S. hopping on board? “No,” the administration will say, “it doesn’t matter what others do, as long as India and China are not in…” But, then again, India is on track to cutting emissions 25% by 2020 anyways and China just announced investments of up to $280 billion over the next several years, and has a renewable energy standard of 15% by 2025. Well, if we go past the tipping point, the city where I grew up will be under water, and so will most of the major cities in the Dominican Republic and many other countries all over Latin America. Anyways, this is all really impressive, but don’t think we’re stopping there…

As I mentioned, I work for an organization in the Dominican Republic that promotes sustainable development. I’m currently leading a renewable energy campaign that seeks to make the country climate neutral by 2030, with a medium-term target of 50% renewables by 2020. The current law doesn’t call for this, but our campaign is looking to do something that hasn’t happened in many places. The country, as many know, is blessed with great beaches and beautiful landscapes. No wonder, then, that tourism is the #1 sector of the countries economy. Next year, it will experience a demand of around $10 billion. So, what are we trying to do with this sector, specifically the $10 billion in demand?

Our renewable energy campaign is calling on the tourism industry to use take out 2% of its demand ($200 million) every year, beginning in 2010, to invest in renewable energies and new mobility systems together with all the investors that will be rushing into the country. With this scale of annual investments, the carbon neutrality target is clearly achievable. The logical question is, why would the sector be interested? Well, a story is well-deserved. The sector began to grow in the 1960’s, when the government passed a law that gave tourism activity a 100% tax exemption and payments for roads and other services. As a result, the sector kicked off. A decade later, many incentives remained, but taxes were put in place (well, the hotels couldn’t run out, could they?). Today, they have a 30% tax on their income, though some of it is reinvested in roads and other things that they need. What we’re saying is this: here’s the opportunity to enjoy of the business opportunity you had in the 1960’s.

With this new renewable energy law, the tourism sector can meet Agenda 21’s call for social and environmental responsibility at a huge profit. The sector has the opportunity to team up with foreign investors in scaling renewable energies in this country and make profits, all with 100% tax exemptions for at least 10 years and a feed-in tariff. Under our view, there’s no reason why the sector should ignore this business opportunity. The reason why others are already planning to invest more than $2 billion in the next few years is because this law makes these investments highly profitable. Here’s a chance to reduce and stabilize energy costs in the country, promote strong economic growth and fossil fuel independence, create 1 million jobs while at it, and green up the sector’s image, attracting ever-more tourists. In fact, the sector’s decision to do this would likely lead this country to achieve a very high quality of life (more than $25,000 per capita; of course, this does not fit the entire picture of “quality of life”) within 10-15 years at current rate of economic growth.

For those skeptical ones who ask: “how is the government going to pay for this?” Currently, electricity costs are over $0.22/kW-hr. This is more expensive than solar! The reason is that most electricity comes from oil. While coal and natural gas are on the way, it will still keep electricity prices up at around $0.15/kW-hr. So, this means that funds are going to come directly from price differences. For example, if wind costs US $0.07/kW-hr, the market price is still $0.15 or 0.22/kW-hr, and that’s what they charge. The difference they keep is used to pay the premium. In addition, the government currently taxes gasoline and natural gas at 5%, so those funds will be used to pay for homeowner installations.

All in all, this looks like the future for the Caribbean and the rest of Latin America. Where is the U.S.’ leadership on this area? If nothing is done about emissions, all the work in Latin America won’t matter. Global warming will destroy us anyways. The hope is that these bold actions by both the government and the private sector send a message to Washington, D.C. and Europe: climate neutrality for the world within 2 decades is necessary!

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