Sun, Sand, Sea and Solar

“Sun, sand and sea” has been used on numerous tourism brochures and in vacation marketing for many years. Perhaps it will be appropriate to add another word to that phrase, solar. One of the main drivers of the tourism sector, our abundant sunshine, is also the impetus behind the nascent renewable energy sector. Anyone flying into the country, or while driving around the island, will notice the increased number of rooftop solar projects on homes and businesses. In the next few years, the landscape of the island will be transformed by solar farms, some of which are already being constructed.

The reason for these changes is the alignment with the Barbados National Energy Policy (BNEP) which set a bold renewable energy goal for Barbados: fossil-fuel free electricity and transport by 2030. It is an ambitious goal but one which is supported and being driven from the very top. Our Prime Minister, Mia Amor Mottley made a powerful speech at the COP26 in Glasgow recently and is a respected leader on climate action. This is evidenced by Prime Minister Mottley having received the 2021 Champion of the Earth award for Policy Leadership by the United Nations Environment Programme (UNEP), the UN’s highest environmental honour. Suffice it to say, the political will exists to achieve the 2030 goal.

A follow through of that leadership is that the legal framework and regulatory foundations have been established, in the form of the Electric Light and Power Act and the Feed-in Tariff (FIT) Program for systems up to 10MW. Competitive procurement will apply for systems greater than 10MW. As of September 2021, 52MW of solar photovoltaic capacity has been connected to the grid. Solar PV systems have been installed on hundreds of homes, businesses, churches, schools and Government buildings. The sight of electricity producing solar panels on rooftops is becoming as ubiquitous as our solar hot water collectors and tanks. This is just the beginning. The Implementation Plan for the Barbados National Energy Policy calls for 625MW of overall renewable energy generating capacity by 2030.

The renewable energy industry has benefitted from unprecedented local and international interest as a result of the Feed-in Tariff program. However, this rapid growth has placed strain on the resources of the entities approving projects which has led to pre-construction delays during much of 2020 and 2021. It is estimated that over 200MW of applications are awaiting approval, most of which are ground mounted solar projects. The entities involved in the permitting and approval of renewable energy projects have received feedback from individual companies and the Barbados Renewable Energy Association and have streamlined their processes. One such example is a new online application system being managed by the Ministry of Energy, Small Business and Entrepreneurship, that will serve as a single-entry point into the renewable energy licencing process. The soft launch was December 1st, 2021 with the full launch scheduled for early 2022. The new online system promises improved efficiency and noticeably shorter timelines.

With the maturing of the clean energy market in the coming years, solar PV systems will transition from primarily rooftop projects to ground mounted ones. Rather than a few large, centralized utility scale systems, it is expected that multiple distributed generation projects in the 500kW – 1MW range will be spread out geographically across the island. Such systems will utilize 2 – 4 acres of land area, with sheep grazing beneath the solar panels to provide an agricultural benefit. Another aspect of the expanding sustainable energy sector is the introduction of other energy sources besides solar energy. Onshore wind energy projects are currently under development and offshore wind is being investigated. Biomass will also play a role in reaching the 2030 target.

Going into 2022 and towards 2030, the renewable energy industry in Barbados will accelerate towards the 625MW target. The introduction of the Electric Light and Power Act and FIT program has liberalized the energy market for Independent Power Producers (IPPs), opening up a BDS $1 billion a year opportunity. Which means that the utility company is no longer the sole entity generating electricity. Furthermore, their existing fossil fuel based generating systems will be retired. The market is ready for new entrants to produce clean, sustainable electricity for the country.

Participation and investment opportunities exist for both local and international interests. Partnerships can be established with landowners on the island to co-develop a solar farm. There is an investment platform in the very early stages of development which will allow investors to invest directly into projects. When more projects are constructed and bundled together into a portfolio, it is anticipated that “solar bonds” will be available as an investment option. Solar power will continue to transform the physical landscape of Barbados along with the financial landscape far into the future.