Published 29 November 2023
Basseterre
Buckie Got It Media Source
Federal Government and SKELEC Successfully Renegotiated Solar PV and Battery Energy Storage Project to the Benefit of Residents of Saint Kitts and Nevisย
BASSETERRE, SAINT KITTS, November 29, 2023 (Press Secretary): The Government of Saint Kitts and Nevis and the St. Kitts Electricity Company Ltd (SKELEC) have executed an Amended Power Purchase Agreement (PPA) with project developer SOLEC Power Ltd for the largest solar PV and battery energy storage project in the Caribbean. The Project, scheduled for completion in 2025, will provide Sainstt Kitts with 35.7 MW of solar capacity and 43.6 MWh of battery storage for the delivery of clean, renewable, and reliable energy for 25 years.
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During the past year, the Government directed a complete and thorough review of the Project and further directed the renegotiation of several key elements to the previously signed PPA, the most important of which were: (1) a reduction in the Power Purchase Price; (2) an opportunity for local private sector investment in the Project; and (3) rigid timelines for completion of the Project.
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Consequently, the Caribbean Centre for Renewable Energy and Energy Efficiency (CCREEE) was engaged as the CARICOMโs top resource for renewable energy projects in the region to review the elements of the previously signed PPA, after the Project developer provided a waiver for such review to be undertaken. CCREEEโs report, in addition to the Governmentโs commitment to reduce the price of power for consumers and facilitate local investment into the energy sector, provided the basis for all stakeholders to effectively negotiate a long-term solution for all parties.ย
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With the execution of the Amended PPA having a reduced fixed power purchase price, SKELEC is now set to save approximately USD$200 million over the life of the PPA when compared to power generated by diesel power generation. The Amended PPA also now allows for local investment through SKELEC to further reduce the PPA price so that local investors can benefit directly from the return on investments in this Project.ย ย
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Importantly, local investment is not required until the Commercial Operation Date, scheduled for 2025, which affords interested private sector businesses and investment-minded individuals the opportunity to observe and assess the complete and functional Solar PV and Battery Energy Storage Facility before making any investment. Additionally, with the Amended PPA, the project developers are now bound by hard timelines to ensure completion of the Project.
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On successful completion of this fully integrated solar photovoltaic system and a lithium-ion battery energy storage system (BESS), the facility will supply Saint Kitts with 30% to 35% of consumersโ annual electricity demand by utilizing sustainable and renewable solar energy with ZERO carbon emissions. The solar plus storage facility will replace 4 million gallons of diesel per year providing a reduction of 43,500 metric tons of C02 emissions.ย
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The BESS, in addition to providing energy storage and dispatchable power, will also provide grid balancing, spinning reserve, and emergency power (in the event of power loss at SKELECโs Needsmust Power Plant) which will increase grid stability and reliability while providing higher quality power to consumers.ย
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The Project is completely financed with USD 80 million in private capital investment, including debt financing being provided by CIBC FirstCaribbean International Bank, requiring no capital outlay by SKELEC or the Government of Saint Kitts and Nevis. SOLEC Power Ltd, the project developer, is a joint venture of Leclanchรฉ SA (Switzerland) and Solrid Ltd (Canada).
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Close to 200 local jobs are expected to be created during the construction and installation of the Solar PV and BESS project while utilizing approximately USD$10 million in local goods and services. Construction is slated to begin in the 2nd quarter of 2024 with the provision of solar energy power to SKELEC in 2025.ย
