Article Information

• ARTICLE_POSTED_BY: Haiti Place Staff
• ARTICLE_POSTED_ON: Apr 24, 2015
• Views : 1101
• Likes : 3
• Category : Business
• Description : It is well-known that Haiti's energy sector is extremely vulnerable. Exorbitant electricity costs and limited availability push investors away, challenge businesses, and put a strain on the country's budget.
  

Overview

• Jacques Bingue
  It is well-known that Haiti's energy sector is extremely vulnerable. Exorbitant electricity costs and limited availability push investors away, challenge businesses, and put a strain on the country's budget.
  
  It is becoming vital to address the energy issues and to find alternative solutions. 
  
  
  We have spoken about the extent of this issue and the possible solutions with Dr. Jacques Bingue, CEO at Innovative Energy Solution, an engineering company based in Ohio. Jacques is also part of The Haitian Diaspora Investment Fund Advisory Council, an organization that promotes Haiti's development through its private sector.
  
  According to Jacques, today Haiti is using locally sourced energy - mostly wood to produce charcoal. It is also importing petroleum products such as gasoline and diesel, which are very expensive. The country produces a limited amount of electricity that is costly and scarce. For example, Port-au-Prince is only getting on average about 3 hours of energy a day.
  
  The country is bleeding money for electricity
  
  On average, the delivered cost of electricity in Haiti is 40 cents per kWh, which is a high cost. However, the Haitian government is subsidizing it and offering it to the end consumer at a cost of 35 cents for businesses and 18 cents for the residential sector, which makes the country lose money.
  
  "Haiti runs a deficit of about 200 million dollars a year on the electricity sector," says Jacques Bingue. 
  
  "Almost 10% of the budget of the Haitian state goes to subsidize electricity. This is a country that's already poor!"
  
  Also, according to Jacques, the state-owned company is losing about 70% of the electricity it produces. In other words, 70% of the electricity that it produces is not being collected for. Possible reasons are that the government doesn't want to collect for electricity, there are technical losses, also, a lot of people in Haiti tap illegally into the grid.
  
  Businesses need to build their own power plants
  
  On the other hand many businesses in Haiti cannot rely on the small amount of electricity available. So, they have to install their own generators which gets very expensive.
  
  This situation raises the cost of doing business significantly. Jacques gave an example.
  
  "There is a new Marriott that opened in Haiti. I believe it's a 40-million-dollar hotel. Out of the 40 million dollars, they have to spend roughly about 6 million dollars to build their own power plant. Can you imagine that? If you want to make an investment you have to make extra investment to build your own electricity structure, and you also have to manage it. You have to hire extra people to manage this power plant. That could discourage anyone from investing in Haiti."
  
  Smaller businesses that do not have the resources to buy generators are operating on the electricity availability schedule, which results in a lower capacity and lost revenue.
  
  Also, high electricity costs makes everything more expensive in Haiti. According to Jacques, hotels charge their guests an additional $25 fee a day for electricity.
  
  Haiti needs to transform
  
  Jacques believes that there are solutions to the energy issues that Haiti is facing right now.
  He recommends that Haiti expands its own electricity network, and stay away from importing electricity.
  
  "It is very important that Haiti does not depend on other countries for certain things. For example, for food, for energy. Haiti will have to import some of its energy, especially the primary energy, but I do not advocate importing electricity. The reason why is because those are the things the Haitian society needs to learn to do for themselves."
  
  
  In his opinion, to develop the electricity infrastructure, the first thing the country should do is to make an analysis based on two criteria: electricity price and availability. And based on that it can decide which methods to use to generate electricity.
  
  "If you use solar and someone cannot pay for solar electricity, then you are wasting your time. If you are using wind and the wind is not available when your customer needs it, then it's no use," says Jacques. He believes Haiti should use multiple methods to produce electricity.
  
  He is convinced that Haiti can achieve producing electricity at a cheaper cost that would be under 18 cents per kWh. At that point the government should stop subsidizing electricity.
  
  Diaspora can get involved
  
  "The Diaspora can use its economic power and also its knowledge to help Haiti across the whole energy value chain," says Jacques.
  
  "There are a lot of members in the Diaspora with experience in this. This is where the Haitian society, both the government and the private sector, need to invite the Diaspora to come and help solve that energy problem at all levels, from management, to technical, to planning, etc."
  
  Of course, expanding the electricity infrastructure requires large investments, but Jacques believes this is not really an issue. He thinks that the Diaspora can help finance the infrastructure cost, as well as the multilateral lending institutions and the private equity. In his opinion the ball is in the government's court, and it takes a lot of political will to bring change to this sector.
  
  Jacques stresses that the entire economy is dependent on this reform.
  
  "Unless you fix the energy sector you are not going to go anywhere. If you can't fix the energy sector, you cannot fix the agriculture, manufacturing, etc. You cannot fix any of those sectors," noted Dr. Jacques Bingue.
  
  
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  Dr. Jacques P. Bingue is the Founder of Innovative Energy Solution, and a combat decorated veteran of the US Marine Corps. His expertise in energy efficiency and waste-to-energy began as a mechanical engineering undergraduate. Dr. Bingue obtained his doctorate in Mechanical Engineering by developing a process to obtain clean and carbon-free hydrogen from petroleum toxic wastes. His main strength is maximizing energy output, thus monetary savings, from waste streams.
  
  Copyright: 11thDepartment