NEVIS HOSTS GEOTHERMAL CONFERENCE

UNCLAS BRIDGETOWN 000430

SIPDIS

E.O. 12958: N/A
TAGS: ENRG PREL EINV KTBD IR XL
SUBJECT: NEVIS HOSTS GEOTHERMAL CONFERENCE

REF: BRIDGETOWN 346


1. (U) The Nevis Island Administration (NIA) hosted the
first Eastern Caribbean Geothermal Energy Conference on
Nevis, June 30th through July 2nd to promote geothermal
energy in the region. In Attendance were government
officials from St. Kitts and Nevis, St. Lucia, Dominica, and
St. Vincent and the Grenadines. The governments of France
and The Netherlands were also present to represent the
interests of their Caribbean territories, and the French
power company rounded out the attendees. Geothermal experts
from the University of Auckland in New Zealand put on a
one-day geothermal workshop to close out the three-day
conference. Representatives from West Indies Power (WIP),
the company developing the geothermal reservoir on Nevis,
were more than pleased with the conference and the NIA
support of the project in the press.


2. (U) While attending the conference a key NIA official,
Carlisle Powell, the minister responsible for natural
resources, came out publicly with strong support for the
development of geothermal energy on Nevis. Powell stressed
the need to reduce the cost of electricity to Nevisians, who
currently pay one of the highest rates in the world, in order
to sustain economic growth for the small island. In 2008, he
noted, Nevis spent $33.3 million on diesel fuel to generate
electricity for the island. Citing the instability of global
oil markets and Nevis' 100 percent dependence on foreign oil,
Powell insisted it was necessary to develop the geothermal
resource for the security of the island. According to
Powell, Nevis will begin to utilize geothermal power by
mid-2010. Current geothermal exploration on Nevis is showing
that, if only half the geothermal potential on Nevis is
developed, there will still be substantial excess energy for
export to neighboring islands.


3. (U) In recent meetings with Poloff, the general manager of
WIP, Kerry McDonald, has been optimistic about the
development of geothermal power on Nevis. After the success
of the conference, McDonald is even more pleased with the
enthusiastic backing by the NIA. McDonald acknowledged that
representatives from WIP recently presented the geothermal
energy option to the congress of the United States Virgin
Islands (USVI) and, according to McDonald, were received
favorably.


4. (U) Comment: It is good to see that the Nevis Island
Administration is behind the geothermal project, and they see
the potential for their small island to benefit. The first
island to receive any excess energy will likely be St. Kitts
due to its proximity, and several major tourism projects on
St. Kitts have already expressed interest in tapping into any
geothermally-generated electricity from Nevis (reftel). Any
sale of geothermal energy to the USVI, on
the other hand, would require the installation of a roughly
$500 million undersea cable from Nevis to the USVI, via
Puerto Rico -- an ambitious undertaking that would likely be
feasible only if Puerto Rico itself was also a beneficiary.
NIA and WIP officials believe Nevis will be generating
geothermal energy in 2010, however, every timeline announced
to date has been pushed back six months to a year.
HARDT