By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A $500 million alternative energy project yesterday pledged that its sea turbines could “generate as much power as this country could ever hope for”, and at rates 50 per cent below the Bahamas Electricity Corporation’s (BEC) existing tariffs.

Nathaniel Edgecombe, president and chief executive of American Middle East Engineers (AMEE International), said his proposed joint venture with a UK-based renewable energy provider could ultimately realise between $500-$600 million in annual cost savings for the Bahamas.

This, he explained, would be derived from the project’s use of tidal/current power to generate electricity through turbines located on the ocean bed, thereby totally eliminating BEC’s existing $300-$400 million annual fuel import bill.

Apart from meeting the Bahamas’ immediate need for an additional 100 Mega Watts (MW) of generation capacity, and another 50-100 MW for the Family Islands, Mr Edgecombe said the project could ultimately be ‘scaled up’ to produce 400 MW.

This would provide 100 per cent coverage for the Bahamas’ short and medium-term energy needs, he added, telling Tribune Business: “The initial annual savings would be a minimum $400 million.”

Adding that these savings could eventually rise to $500-$600 million, Mr Edgecombe described these estimates as “very much on the conservative side”.

“Right now, they [BEC] are shelling out between $30-$40 million a month for fuel,” he told Tribune Business. “On that side alone, you’re looking at potentially $480 million [in savings].

“They would also not have to spend at least another $100 million in terms of expensive, mechanical parts to service the old, outdated fossil fuel engines. The labour costs attached to that also run into the millions of dollars.”

Mr Edgecombe and his companies, AMEE International and Emerald Waterways Development, together with fellow Bahamian Eugene Turner, have teamed up with UK-based Renewable Energy Power Systems (REPS) to develop their alternative energy proposal.

The project envisions unlocking the ocean’s kinetic energy potential by locating a series of turbines - capable of each generating at least 2 MW - on the seabed at depths in excess of 40 metres.

Stating that this will ensure the turbines do not interfere with other sea users, the group believes ocean currents of just two knots will be sufficient to generate power, with five knots the “optimum” speed.

“This will be able to generate much more power; as much power as this country could ever hope for will be generated,” Mr Edgecombe told Tribune Business.

“All you’ll have to do is position your turbines in strategic areas of the ocean throughout the Bahamas, and the Bahamas will never have another need for electricity in the ensuing years.

“Look at the impact it’s going to have with respect to the future development of the country as a whole, for existing companies and long-term investment,” he added.

“With such favourable results in energy, that automatically increases investment opportunities and results in existing businesses generating huge reserves to reinvest in the country.

“This has tremendous, wide-ranging effects for the country and its future.”

Mr Edgecombe conceded that surveys were needed to determine “the most feasible locations” for the sea turbines, but said it was possible just one could supply the energy needs for all the south-eastern Bahamian islands.

REPS and its principals, John Ellison and Robert Fitzpatrick, have worked on projects in countries such as Australia, Canada and India.

Mr Edgecombe said the company had just won “a major contract” in Gibraltar, and the group had “the background documents to prove financing is available” for the Bahamian project from a group of major European banks.

The group’s plan is to reach a power production agreement (PPA) to sell its wave-generated energy to BEC at a fixed $0.20 per kilowatt hour (KwH) price for 25 years.

That price is around 50 per cent of BEC’s existing tariff, which ranges from the high 30 cents to low 40 cents per KwH.

Mr Edgecombe added that the project, which will take two years to construct and get operational, would “be gifted” to the Government and BEC after the 25-year contract expired.

And he added that its ownership would be 100 per cent vested in the Government from the outset, with REPS and its Bahamian partners earning their money from a management/operations contract and payment for electricity sold.

“In the ensuing years Bahamians will be able to afford electricity,” Mr Edgecombe said. “Bahamians could ultimately look forward to no further increases in their electricity bill. They will experience drastic decreases.

“In 2011 there were 8,000 Bahamian households on this island that could not afford electricity. With this being gifted, Bahamians could potentially end up paying one-third of what they are paying now for electricity.”

Mr Edgecombe said that apart from the project’s economic and social benefits, its use of emission-free natural resources - and absence of fuel - would also boost the environment.

While the Government has deferred any decision on whether to approve renewable energy projects until 2014, as it prioritises sorting out BEC, Mr Edgecombe said it was vital that a National Energy Policy - together with legislation and regulations - be published “ASAP”.

“For the ongoing good of the development of the country as a whole, it’s extremely important,” he said of such a policy.

“The cost of electricity is increasing, and there is no guarantee in place that it will decrease any time soon.”