Contributing writer Dickson Igwe
A series of articles on a new British Virgin Islands integrative development model, discuss why privatization and liberalization of the local power industry are the way forward for a cheaper, more self sufficient, renewable, and greener energy future.
The British Virgin Islands Electricity Corporation, in the near future, may have to be privatized, and simultaneously broken up into a number of smaller energy type businesses owned by BV Islanders, and Citizens, if this tiny country is to proceed towards a renewable, and cheaper and cleaner, energy future.
This belief and assertion comes from some in depth reading of the views of writers on the subject of renewable energy in the local and global media, by this Village Square Thinker.
Consequently, the conclusion can be reached, that the road of privatization, and the liberalization of domestic power and energy provision in the British Virgin Islands, is the swiftest, and most viable way of moving the country towards a more efficient, self sufficient, and secure energy future.
Now, whether this is the time for a bold change in the business culture of these British Virgin Islands or not, only time will tell. But a forum and discussion on the issue of power and electrical generation, and how a new and much more liberal dynamic must be created in the coming years, is critically necessary at this time, for the country.
And one ‘critical source’ has already told this Observer that this proposition may well be very unpopular to a majority of the population, owing to a belief that ownership of a newly liberalized and privatized electricity industry will be grabbed by the rich and powerful, and to the detriment of Joe Public.
However, this Writer’s retort was, ‘’not necessarily so, if the process is fairly handled, well legislated, discussed, and designed to ensure that everyone gets a fair share of the electricity cake.’’
This Villager will further add that if privatization, and liberalization of power, is determined as requisite for this country, then every effort must be made to ensure that the new businesses emerging from the old BVI Electricity are owned by BV Islanders, and Citizens, with alien interests limited to bond type instruments, bills of exchange, consultancy contracts, the supply of machinery and equipment, add related and relevant products not readily available locally.
And not handing over a critical utility and industry to the management and ownership of a foreign company, but keeping the energy generation industry local.
As it is with the national water infrastructure, power is a critical utility, and it must remain in local hands. The equitable and fair privatization of a future BVI energy industry is something government can ensure.
And for a model of the process, and likely outcome of a BVI electricity privatization dynamic, the country need look no further than Margaret Thatcher’s Britain of the 1980s and early 90s, when the wholesale privatization of major public utilities in Britain, such as British Telecom, Trustee Savings Bank, the British Gas utility, British Airways, parts of British Rail, and many other public entities, eventually led to greater efficiency in formerly inefficient, public owned organizations, and new wealth opportunities created, in terms of private ownership of stocks and shares in the newly privatized businesses for Britain’s peoples.
Britain’s privatization brought greater dynamism to her stock exchange, strong economic growth, and a new prosperity enjoyed by her middle classes. The British Government actually made more money in terms of taxation from profitable businesses after privatization and liberalization than from its ownership of loss making parastatals, post World War 2.
Bear this in mind also; the BVI witnessed a form of liberalization of its telecoms industry some years back, that saw cellular and landline phone bills decrease substantially, from the good old days when Cable and Wireless, and Caribbean Cellular Telecommunications, held monopolies on both products, and essentially determined their own pricing, year in and year out.
On a related note, one wonders why BVI Cable TV does not get into the internet business, and would that not further bring down internet prices for Joe Public? Does that organization not possess a natural cable network that could carry internet traffic? Then add a cable oriented voice over the internet type product? Anyway, that is another matter!
Now, the Virgin Islands Premier, Honorable Dr. Orlando Smith, in an article on Virgin Islands News Online of January 24, 2012, headed ‘’ high cost of electricity a great concern for Premier Smith’’ stated that alternative and renewable energy, were long term goals for his administration.
The VINO article described the Premier as stating that he was looking at ways of getting the Ministry of Works and Communications, ‘’working with the BVI Electricity Corporation, to introduce improvements that will lead to lower costs.’’
Interestingly, in his State of the Union Speech of January 24, 2012, President Barack Obama of the United States also determined that clean and renewable energy was the future for the American way: a new modus Vivendi for the world’s most powerful nation. The US electrical grid and power generation companies are wholly privately owned.
The US President, in his speech, asserted that alternative and green energy was the future of US prosperity and job growth. Bear in mind that for the United States, this is a national security issue, and so it should be for these Virgin Islands in the sun.
Renewable energy, food sufficiency, and internal security, are all related matters, and critical to the future way of life, and life quality, and even standard of living of these Treasure Islands.
Incidentally, in the BVI Beacon Edition of January 26, 2012, the issue of electricity generation, and the high price the Virgin Islands consumer pays for electricity was a prominent feature of the opinion columns.
National Forum Contributor, Edgar Leonard, exhorted in an article titled ‘’ ideas offered for cutting electricity costs,’’ that ‘’ the Virgin Islands should establish an independent regulatory agency.’’
He determined that the current self regulated monopoly that is the BVI 
Electricity Corporation had ‘’ little or no incentives to minimize cost.’’ Mr. Leonard further asserted that the current ‘’ arrangement could result in inefficiencies and higher production costs.’’
The National Forum Contributor gave a valuable citation of a report on Puerto Rico’s Electric Sector that explained how an independent regulator ‘’ could provide various functions: setting price caps and rate of return regulation; establishing, reviewing, and revising electricity prices and tariffs annually; setting price adjustment criteria; protecting consumer interest; approving capital investment plans; reviewing and facilitating opportunities to transition to renewable energy sources; and providing general oversight of the electricity utility.’’
Leonard offered excellent ideas on lowering costs in the electricity marketplace such as : ‘’ collaborating with other regional countries on joint purchasing of bulk fuel to achieve economies of scale, thereby reducing cost; researching the possibility of buying fuel directly from wholesalers; and allowing residential households and small businesses to use solar panels and small wind turbines to generate electricity.’’
This Writer would further add large businesses and organizations as well, who can afford the expense of a relatively new type technology.
Leonard described how ‘’ fossil fuel is the primary energy source used by the Virgin Islands to generate electricity. But it is expensive. As such, the Virgin Islands, like most of the region, needs to explore other energy sources.
For the long term, the territory should consider wind, solar, thermal, compressed natural gas, photovoltaic, and coal as possible sources to address its critical power needs.’’
The use of clean coal technology for electricity generation is a very interesting idea owing to the abundance of this resource in the hemisphere. Liquefied natural gas is also a fuel that is abundant in these Americas and ultimately cheaper than dwindling oil based global supply model.
And do bear in mind the hidden and unpaid costs of dirtier fossil fuels such as petroleum, in terms of environmental damage.
The effects of fosil fuel pollution. Photo courtesy ecoble.com
Leonard further admonished the Virgin Islands ‘’ to explore interconnections with islands like Nevis, which may have excess capacity from its promising geothermal explorations.’’
Again, there has been a suggestion that the technology exists for certain types of waste, including sewage, to be converted into energy, even the breaking down of waste plastics into a liquid form that could be used to run diesel engines, add the use of heat from the garbage incinerator to generate power into the surrounding areas, interesting ideas indeed!
Leonard’s commentary showed just how much could be done to reduce this country’s dependency on fossil fuels and nurture a new clean energy dynamic for the future. And understand this: fossil fuels will probably always be part of mankind’s energy equation.
But fossil fuels are finite, and with emerging economies such as China and India demanding millions of extra barrels of oil daily, the demand pressures on hydrocarbons will continue on an upward trajectory, with prices continually on the rise. Add a volatile Middle East, and this is even more the case.
This Lay Ecologist however, will assert that for these Enchanting Antilles, the only way to bring down the price of electricity and related energy costs will be within the context of a liberal and free enterprise energy environment, albeit well regulated, and directed by a new government department of energy and powerful regulator.
Yes, only then will the overwhelming dependency on fossil fuels be ended, and a renewable and cheaper energy future realized.
To be continued
