To deal with oil shocks, the Caribbean needs to accelerate its transition to renewable energy, according to officials

The Caribbean Development Bank president stated on Wednesday that Caribbean countries must speed up their transition to renewable energy in order to reduce their dependency on fuel imports, which have increased in price since the start of the Ukraine conflict.

In a lecture, Gene Leon noted that imported petroleum products meet roughly 80% of the energy requirements of the 19 nations that borrow money from the Caribbean Development Bank and that these imports cost those nations $7 billion each year.

“You are at the mercy of volatility in the price of that commodity due to the pervasiveness of energy in everything you do,” Leon remarked at the Caribbean Renewable Energy Forum that was held in Miami.

“As a region, our goal is to develop a suitably diversified mix that is both inexpensive and that we can produce with sufficient control to ensure (energy) security.”

Because the energy in the Caribbean is mostly produced from the imported fuel, Leon estimates that it costs 3 to 4 times more than in developed nations, placing the region at a disadvantage compared with its trading partners.

To solve this, he suggested that Caribbean countries produce 320 megawatts of additional renewable energy each year, compared to just 25 megawatts installed in the region in the previous nine years. This would necessitate a $1.2 billion annual investment.

Considering Caribbean governments usually to have huge debt loads which make it very difficult for them to access new loans even from international agencies, Leon believes that private enterprise will be the most likely source of funding for this initiative.

Getting the private industry on board will need persuading them to “identify opportunities where energy provision becomes worthwhile for them as well,” he said.

One of the bank’s plans is to put climate resilient rooftops in 75 percent of residences in the region by the year 2035, which can generate power and endure harsh weather events.

The Caribbean Development Bank, based in Barbados, has 25 member nations as well as 19 borrowing partners, and its mission is to provide funding to the region’s less-developed countries.

In the last seven years, the CARICOM (Caribbean Community and Common Market) and several regional governments have created renewable energy goals, which have resulted in significant development in energy governance and capacity building. Other established forums, such as the Caribbean Renewable Energy Forum (CREF), and roadmaps, such as the Caribbean Sustainable Energy Roadmap and Strategy (C-SERMS), are meant to aid transition efforts. For example, Jamaica and the Dominican Republic have made great progress in decarbonizing their electric grid by substituting natural gas for fuel oil and implementing new renewable energy systems. Indeed, the commercial case for renewable sources remains strong throughout the region, as fuel and power prices remain substantially above those in the US.

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