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Editors' Forum | 'JPS will have to adapt' - LNG gives local entities power to leave grid

Published:Friday | September 15, 2017 | 12:00 AMErica Virtue
Rudolph Brown/Photographer Aiken

As major local entities seek to lower their electricity bills by introducing liquefied natural gas (LNG) to their energy mix, the Jamaica Public Service Company (JPS) is being urged to tweak its operations to move with the times.

Major JPS customers, including Red Stripe and the University of the West Indies, Mona, have already indicated that they will be taking significantly less power from the national grid, and the JPS has admitted that this could hurt its bottom line.

"We all should be concerned and thoughtful. You don't want everybody who can afford to ... going off the grid because you would still have to pay for the grid," former JPS president and CEO Kelly Tomblin told The Sunday Gleaner in February.

At that time, Tomblin admitted that the JPS could face serious challenges if its top 50 customers were to leave the grid, which would have to be paid for by smaller consumers.

But responding to questions at a Gleaner Editors' Forum last Tuesday, deputy director general of the Office of Utilities Regulation (OUR), Hopeton Heron, said this is a possibility that the regulator has already considered.

"The energy sector is changing. Any industry has to watch the global move and adapt. So that said, we are always concerned that as the large users leave the grid, the poor customers, who cannot afford it in the first place, will have to pay for all the fixed costs," said Heron.

"As the regulator, you have to look at all aspects and be balanced," said Heron, as he argued that it is market conditions that will cause the big customers to leave the JPS grid.

"I cannot say what the JPS will do but the action of the customers who have left the grid is a response to the market," added Heron.

In the meantime, director of engineering and deputy dean in the Faculty of Science and Technology at the UWI, Dr Paul Aiken, told the forum that moving from the sole dependence on the JPS for its energy needs is a practical move for the university, which will realise savings to make the cost of education cheaper for its students.

"We have to reduce the cost of operations. If we keep driving up the cost of operating the university, then it's going to translate into the tuition and they can barely afford the tuition as it is," said Aiken, as he argued that the investments now being made in LNG will ensure that the cost to students will be much more affordable.