Turks and Caicos Islands

equested a rate review to rebalance rates among the various customer categories to better reflect cost of
service in particular for hotels, for which the tariff is under the average cost of service (Castalia, 2011).
However, there are preferential rates of duty in place for certain sustainable energy equipment and
technologies (e.g. compact fluorescent bulbs and solar water heaters), with higher duties on clothes dryers,
electric water heaters and electrical heating resistors.
Instead of reducing electricity costs, the savings made in introducing the new technologies should be reinvested
in additional renewable technologies and sustainable energy development to further reduce
dependence on fossil fuel imports. Haraksingh (2001), for instance, outlines that there is a huge potential to
use solar energy. Both economical and non-economical technical solutions to reduce the energydependency
of islands in the Caribbean could thus be implemented based on regulation, market-based
approaches and incentives, as well as through financing derived from voluntary and regulatory carbon
markets. Policy intervention is however needed to initiate these processes. Overall, Haraksingh (2001: 654;
see also Headley, 1998) suggests that:
The Caribbean region is a virtual powerhouse of solar and other renewable sources of energy
waiting to be exploited. It has the advantage of not having winters when hot water demands can
increase from summer by approximately 70% in cold climates. Solar water heaters for the tourism
industry and domestic and commercial usage have perhaps the greatest potential. There is a
general commitment to the development of RE, but matters have not gone very far beyond this.
The movement towards greater implementation of RE technologies is gaining strength, but there
is a large gap between policy goals and actual achievement. Clearly, much work still needs to be
done. Government fiscal incentives, greater infrastructure for policy development as well as joint
venture partnerships are needed in the Caribbean region for a smooth transition.
Turks and Caicos have laid the groundwork for future renewable energy and energy efficiency initiatives
through the development of the Energy Conservation Policy and Implementation Strategy (Castalia, 2011).
However, more effort and resources are required to develop the action plan that will lead to meaningful
implementation, particularly with regard to the major energy consuming sectors currently not considered,
i.e. shipping and aviation. There are also considerable barriers to be overcome, as outlined by Castalia
(2011:58, 77).
The barriers to installation of energy efficiency technologies include: limited access to capital
because of reluctant financiers; limited and uncompetitive equipment supply because of the low
uptake; incomplete information on the benefits of the technology; and agency problems where the
investor is not the same person as the beneficiary, for example in new construction or leased
buildings.
Barriers to the uptake of renewable energy technologies include: not requiring the utility
companies to consider renewable technologies in an effort to determine the least cost option for
electricity generation; the design of the fuel charge reduces the incentive for renewables because
the utility companies cannot securely recover the costs of investment; there is no regime for third
party generation so that any independent power producer faces an uncertain licensing regime, is
not guaranteed a market since the utilities are not obliged to purchase suitable renewable power
and has no clear technical and economic framework within which to conclude a power purchase
agreement; the permitting and planning process is excessively long given the novel nature of
renewable energy generation projects and concessions for land are particularly hard to get, given
that it is a premium asset in the Turks and Caicos Islands.
Barriers for distributed technologies (i.e. small-scale installations) include: customers are not
allowed to connect their systems or sell electricity to the grid, which potentially makes installation
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