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VINLEC allocates $6.4 million for hydro facilities development

VINLEC allocates $6.4 million for hydro facilities development

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Hydroelectrity has always been and will always be the cheapest means by which electric power is generated in St Vincent and the Grenadines.

As a result, the St Vincent Electricity Services Ltd (VINLEC) has allocated $6.4 million towards the development of their hydro facilities for the year.{{more}}

This is according to chief executive officer (CEO) of VINLEC Thornley Myers, who made the disclosure last Tuesday, while speaking at a press conference at VINLEC’s headquarters in Paul’s Avenue.

“Hydro has always been our cheapest source of generation and we believe that hydro will continue to be our cheapest source of generation. So, any investment that we make in hydro essentially is not expected to impact … negatively on the fact that we are planning to have geothermal,” Myers stated.

He outlined that the main focus of the exploration into geothermal energy is to address the high generation cost of diesel fuel and not to curtail generation of electricity from their hydro plants.

“The geothermal is expected to address that high cost of generation due to diesel fuel. So, it’s not really to impact hydro. And part of what we have said in our discussions with the developers in moving forward is that there cannot be curtailment of generation from our hydro plant.

“In other words on day X, day Y in 2018 or 2019, when our geothermal plants are operating, you would not be able to say to us please back off your hydro because we have geothermal energy and we want to sell it. Naturally, we hope you would say to us ease back off the diesel, because that’s costing us more than you will essentially have to spend to buy geothermal,” the VINLEC CEO also noted.

Myers stated that VINLEC must first ensure that they have the right balance before going forward and signing a contract with the developers for the delivery of power.

He further disclosed that most of these contracts are ‘take or pay’ agreements, where you pay for what you take and even if you don’t take, you still must pay.

“Most of those contracts essentially have what you call take or pay arrangement. But part of what we have to be very studious about is to ensure that when we say we will take or pay, that we will be in the position to take it, because if we are not able to take it then we would still have to pay for it.” (CM)

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