Published On: Wed, Jun 26th, 2024

European millions available for energy transition

PHILIPSBURG — “It is imperative for St. Maarten to look into renewable energy sources and alternative energy sources. The COVID-19 crisis has shown St. Maarten that making deep structural changes and reforms is unavoidable,” Annex IX of the European territorial multiannual indicative program (MIP) states.

The program has €7.7 million (around $8.2 million at the current rate of exchange) available for initiatives in the fields of sustainable and resilient energy and cross-border cooperation. There is even more European money on the line for St. Maarten: €42.67 million ($45.66 million) through the Resilience, Sustainable Energy and Marine Biodiversity Program and €21 million ($22.47 million) via the 2021-2027 Caribbean regional program for the sustainable management of Caribbean OCT’s natural capital. (OCT stands for Overseas Countries and Territories). St Maarten also qualifies for the €15 million ($16.05 million) Decision on the Overseas Association including Greenland (DOAG) which provided Saba with a new solar park.

St. Maarten is also eligible for benefiting from the InvestEU program; though the document does not mention how much money is available from this source, it does state that at least 30 percent must contribute to the fight against climate change.

The European Union describes the situation in St. Maarten in annex IX of its multiannual indicative program. Some of the information is clearly outdated and other information is remarkable, for instance the observation that the cost for producing one Kilowatthour of electricity in St. Maarten is €0.40 ($0.43). If this is accurate it is no wonder that utilities company GEBE is in financial hot water because its base tariff to consumers is $0.13 per Kilowatthour. In other words: the company is operating at a loss, assuming that the fuel clause exclusively covers the cost of fuel.

The document states furthermore that St. Maarten agreed with the European Commission that the priority area of the 2021-2027 territorial program will focus on the Green Deal, especially on “sustainable and resilient energy, under the auspices of improving the overall resilience of St. Maarten.” This approach includes cross-border cooperation with the French side of the island.

The European support for St. Maarten addresses seven targets, as specified in the country’s national energy policy. Among these targets are the ambition to reduce the dependence on fossil fuel and to increase the emphasis on renewable energy, the promotion of energy efficiency, regulating the energy market through the establishment of a regulatory body and legislation and ensuring GEBE’s sustainability.

Several factors are hampering progress in the energy sector, the authors of the document observe. They mention the existence of ongoing fuel supply contracts with big petro companies, but also the current legal and policy framework and the general lack of energy investments infrastructure.

Furthermore, the document notes that St. Maarten “has expressed interest in potentially setting up public private partnerships, particularly in the energy sector.” Apparently, the authors are unaware that the plan of going into business with the American consultancy firm Gridmarket did not meet expectations.

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