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An Overview of Jamaica's Electricity Sector

Jamaica’s energy system is highly dependent on imported fossil fuels, petroleum imports account for over 90 percent of electricity production. This oil import dependency comes at a high cost. Oil import costs peaked with the global oil price spike in 2008, reaching US$2.7 billion. Import costs remain high and can be expected to increase further as oil prices rise in the future. Electricity prices for Jamaica’s people have also shot up dramatically in recent years, reaching a high of US$0.42 per kWh. Consequently, Jamaica is charting a new path to energy security based on domestic renewable energy sources in order to build an energy system that is socially, economically, and environmentally sustainable.

Due in part to the central role of the bauxite and alumina industry, Jamaica has a high energy intensity, consuming an average of over 4,800 kWh per US$1,000 of GDP compared to other Latin American and Caribbean countries.

The electricity generation sector is Jamaica’s largest petroleum consumer. The average efficiency for oil and diesel-fired steam generation in Jamaica is low, at 29 percent. Electricity losses on the grid are declining but still high, at 22.3 percent, of which 10 percent are technical and the rest are from theft and illegal connections.

The hotel & tourism sector faces high electricity costs due to lighting and air-conditioning needs (up to 10% of revenue for some hotels).

The National Water Commission is Jamaica’s single largest electricity customer, with electricity costs accounting for nearly 40 percent of annual revenue. It is currently undertaking rehabilitation efforts on pipelines and storage reservoirs to reduce energy consumption.

The Government’s primary objective is to diversify the national energy supply into a mix of energy sources for energy security.  The policy of the Government of Jamaica is that there is no restriction on the sources of electricity generation and may include   solar photovoltaic, wind, hydro, biofuels/biomass and waste to energy solutions, petroleum coke, coal and natural gas.

Jamaica Public Service Company Limited is Jamaica’s sole electric utility, serving the population of 2.7 million. 

Here’s a quick glance at how the sector has performed over the last five (5) years…

Electricity Generation (MWh)

 

2010

2011

2012

2013

2014

Steam & Slow Speed Plants

1,673,386

1,583,387

1,500,498

1,499,306

1,460,625

Gas Turbines Plants

968,752

990,125

942,402

719,134

854,119

Hydro

151665

152157

150,695

124,345

135,955

JPS Net Generation

2,793,803

2,725,669

2,593,595

2,342,785

2,450,699

JPS Purchases

1,343,496

1,411,178

1,542,319

1,798,473

1,661,428

Total Net Generation

4,137,299

4,136,847

4,135,914

4,141,258

4,112,127

Losses

902,116

961,357

1,032,891

1,097,208

1,102,700

 

21.8%

23.2%

25.0%

26.5%

26.8%

 

Total net generation had a marginal decline over the period, falling by approximately 1%. Total net generation amounted to 4,112 GWh in 2014 compared to 4,137 GWh in 2010. Transmission and distribution losses as gradually increased from 902 GWh to 1,103 GWh, up 22% over the same time period. Losses amounted to 26.8% in 2014.

ELECTRICITY CONSUMPTION / SALES (MWh)

Category

 2010

 2011

 2012

 2013

 2014

Rate 10 (Residential)

1,106,955

1,051,219

1,025,155

986,351

981,658

Rate 20 (General Service)

673,471

643,615

600,501

586,809

577,057

Rate 40 (Power Service)

750,289

775,584

769,138

766,083

764,772

Rate 50 (Large Power)

602,248

607,272

609,240

599,193

591,824

Rate 60 (Street Light)

71,029

71,127

70,062

70,400

70,573

Other

31,240

26,773

28,931

29,600

23,544

Total

3,235,232

3,175,590

3,103,027

3,038,436

3,009,428

Residential electricity customers with 982 GWh followed by Rate 40 (Power Service) with 765 GWh were the main electricity consumers for the last five years.  On average, electricity sales to all rate categories declined by about 1% per annum.

AVERAGE RATE CHARGE (Jamaican Cents per kWh)

Category

2010

2011

2012

2013

2014

Rate 10 (Residential)

2,730.43

3,269.53

3,452.30

3,840.57

4,109.75

Rate 20 (General Service)

2,790.58

3,326.06

3,558.33

3,932.10

4,206.54

Rate 40 (Power Service)

2,335.35

2,848.56

3,036.14

3,317.74

3,476.37

Rate 50 (Large Power)

2,153.32

2,656.72

2,814.05

3,079.36

3,183.59

Rate 60 (Street Light)

3,063.57

3,577.46

3,734.06

4,002.22

4,121.98

Other

1,778.58

2,491.70

2,397.98

2,686.95

2,901.14

Note: As at February 2015, the monthly average exchange rate to purchase US$1 was J$115.70 (Bank of Jamaica)

Analysis also shows that the overall average rate charge was 48% higher in 2014 when compared to 2010 with Rate 10, Rate 20 and street lighting dominating the rate charges during the period. Residential customers ended 2014 with an average rate charge of J$41.10/kWh, Rate 20 with J$42.07/kWh, Rate 40 with J$34.76/kWh, Rate 50 with J$31.84/kWh and Rate 60 with J$41.22/kWh.

 

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