The Caribbean Utilities Company has issued a new proposal to swiftly address a pending shortage in Cayman’s power supply and to allow large-scale solar and battery projects to be considered as part of the mix.
Cayman is looking to add around 50% additional power supply to the grid to meet growing demand.
Initially, a decision from the Utility Regulation and Competition Office, known as URCO or OfReg, indicated the additional power would have to come through diesel generation, which was the only means considered to be “firm capacity”. But CUC appealed that decision in court, and following an out-of-court settlement, it was agreed that a combination of solar power and batteries could also qualify as “firm capacity”.
The electricity company has now gone back to the regulator with a new “certificate of need”, which it released publicly on 19 Sept.
CUC warns of widespread blackouts by 2027
Grand Cayman hit a record peak load of 129.8 megawatts in May.
Demand is expected to continue to grow as the island’s population expands and new hotels and other developments come online, while CUC retires some of its aging equipment. The power company argues that, without new plants or other means to produce electricity, Cayman will face widespread blackouts in the coming years. The company forecasts power interruptions will be experienced over 176 days in 2027.
In its submission to the regulator, CUC stressed that while renewables will be allowed to compete, some fossil-fuel capacity will still be needed for reliability.
The company’s new certificate of need, submitted to the utilities regulator, suggests that the additional capacity be delivered in three blocks to ensure timely delivery and system reliability.
Block 1 would include 36MW of firm energy provided 24/7, likely provided by diesel generators, while Block 2 (33MW generated over 16 hours a day) and Block 3 (25MW generated over 10 hours a day) could be provided via a combination of diesel, solar and battery power.
Call for urgent action
CUC said that since Cayman is racing beyond its power capacity, steps to arrange the generation of the additional power should start immediately, as permits, contracts, financing and construction could take at least three years to complete. It is urging the regulator to launch a request for quotations by 19 Oct. this year.
Under its National Energy Policy, Cayman has a target of having 70% of its power generated from renewable sources by 2037, and 100% by 2045. Currently, only 3% of the islands’ power is generated from renewables.
In July, OfReg issued a request for proposals for what would be Cayman’s largest utility-scale solar and battery storage project, a move that CUC said it welcomed.
However, the power company, in a letter to OfReg accompanying its new certificate of need application, noted that it was “concerned that the current delivery timeline may result in near-term capacity shortfalls and system unreliability risks before the successful project comes online”.
To avoid this, CUC said it had proposed interim solutions to the regulator, including temporary generation of power and life extensions of its retiring diesel generators, and that discussions on these were ongoing.
In a press release about the submission, Richard Hew, the company’s president and CEO, said, “CUC remains steadfast in its commitment to accelerating Grand Cayman’s renewable energy transition, ensuring that it is secure, affordable, and delivers lasting benefits to households, businesses and communities we serve.”
The Compass has reached out to OfReg for comment.