Jamaica Public Service Company’s newly installed president faced the power utility’s shareholders for the first time on Friday saying he wants to make progress on curbing the theft of electricity prior to the heavy push towards clean energy.
Energy costs could be reduced by 20 per cent, which equates to 9 US cents per kilowatt hour, says President & CEO Steve Berberich, if theft is brought under control.
“We need to get after this theft issue and get it resolved finally before we go through this big effort to decarbonise with renewables and also EVs,” said Berberich. “We need to solve this theft before this happens.”
Electricity losses in Jamaica cost the power utility about US$200 million annually, which is about a fifth of all electricity generated. Theft occurs generally when residents hook their own lines to JPS’s system, and when businesses bypass meters via tampering. JPS owns a network of electrical vehicle charging stations and is in the process of adding more. Other companies are making similar investments, and Berberich acknowledged that EV power charge theft could emerge in Jamaica with the growth of those vehicles.
“Losses is a top priority for me,” the JPS president said at the company’s annual general meeting in New Kingston, even while acknowledging that electricity was not affordable for some residents.
Over the past five years, the cost of electricity has fluctuated between 29 and 40 US cents per kWh, with the latter as the prevailing rate in 2022. It’s the highest cost for providing light and power, globally.
In June, the World Economic Forum, WEF, in a report titled Fostering Effective Energy Transition 2023 ranked Jamaica at 115 among 120 nations in terms of shifting towards renewable energy.
“The countries scoring the lowest were Lebanon, Jamaica and the Dominican Republic, mainly because of challenges on the diversity of the energy mix, the need for the energy import and electricity losses,” said WEF.
Berberich, now in the top job at JPS for two months after succeeding Michel Gantois on May 31, said that the shift to renewable energy can come without a jump in light bills. That’s due to the offset of higher capital costs to build plants with the avoided marginal costs of running the plants.
Prior to joining JPS, Berberich led California ISO (Independent System Operator Corp), which manages the flow of electricity across power lines across 80 per cent of California’s grid. The state of California runs on 50 per cent renewables, he said.
Jamaica is shooting for a similar ratio by 2030. But to meet the deadline, investments in wind and solar power generation would need to grow at least eightfold to hit and surpass the target of 50 per cent renewables, according to a recent JPS proposal document.
“I am quite familiar with renewables, the infrastructure required as well as batteries and other technologies required deployed to decarbonise the grid,” said Berberich.
He added that the Jamaica’s fossil fuel plants cost upwards of US$300 per megawatt-hour to run. That relates to its marginal costs. A renewable plant, on the other hand, has “zero” marginal costs.
“So, there is a direct offset that’s an avoided cost to running the fossil fuel plant,” said Berberich.
