Are Micro Turbines the correct energy solution for Jamaica ?

Many businesses in Jamaica having to deal with very high electricity prices, have been looking at ways to lower their energy prices. In many cases they have gone to solar, wind and  Co-generation.

Red Stripe currently has one one of the largest Co-generation plants in Jamaica, which provides it electricity, heating and refrigeration , this plant is referred to as Combined Heat Power Plant or CHP.

The investments in these alternatives are pretty costly and a plant such as the one at Red Stripe cost close to US $7.7M or Ja $ 877.8m at current exchange rate.

Not many companies in Jamaica can or are willing to put up this kind of capital investments to secure their own power source and would therefore look to the market for cheaper alternatives which can give lower overall energy cost that JPS.

Micro turbines appear to be one such consideration, given that these small self contained package units can provide the Power, Heating and Cooling that a small to medium sized operation would want.

These micro turbines have been around for over ten years and tend to be used in remote areas, where the access to electricity is rather limited and it would have been a costly exercise to run power lines from the source to where the power is required.

The question now becomes, how good are these systems and should I consider one for my business.

The key to that question is to look who are the players in that industry and who are NOT playing. The next question to ask, is why are these players not playing and the answer to that question will allow you to be in a better position to move forward.

The generation business have been around for decades and they are some major players in this industry, so you may want to find out if the large players are playing in the micro turbine industry and if not why., given that very few companies would miss an opportunity to make money and if you see them staying away from a particular industry it may very well be that there is no money to be made their.

Next, ask yourself the question, are the players who are in micro turbine industry making money ?

You may have been told that one important measure of a company is the warranty they offer and that can be true but it is not always true.

I have seen many buyers in the energy sector being offered extended warranty on a energy saving item, only to find out that the warranty period is longer than the life time of the company offering the warranty. All this means is the when you have a failure  within the warranty period and you try to effect the conditions under the warranty, you find the company is no longer is business, which makes the warranty null and void.

I have seen many Windmills installed and then taken down and sent to the scrap metal yard as the company out of China which sold them the crap is no longer in business. What really happens however is this.

A local or a foreigner is offered a deal on these items out of China. The guys buys full container loads of the items and then offer them for sale on the local market as the panacea to your energy problems. You got ahead and make the purchase, have the item installed and working. Months later the system fails and you contact the local agent.

The local agent then contacts the agent in China only to find out that he cannot make a link that supplier anyone and that company is no longer listed. In reality what happens is the seller in China offloaded his junk in Jamaica, quickly changes his name and move to another location to repeat the same actions once again.

The subtle message is  Look before you leap !

For people wishing to consider alternatives, please contact the Development Bank of Jamaica to have a qualified energy expert look at what you are being offered before you dive in and drown.


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