• Bahamas Development Bank introduces financing initiative for renewables

• Renewable systems offer consistent power for businesses

By Fay Simmons

Tribune Business Reporter

jsimmons@tribunemedia.net

A NEW $30m facility managed by the Bahamas Development Bank will allow business owners to finance renewable energy systems to combat power generation problems, according to Guildan Gilber, vice president of Alternative Power Sources Bahamas.

Speaking at the Andros Chamber of Commerce Economic and Investment Conclave yesterday, he advised business owners that solutions to their electricity woes are in the pipeline.

He said: “They actually met with renewable energy companies about three weeks ago and they advised that they were getting a tranche of funds and a portion of those funds were going to be used to finance renewables to homeowners, to small businesses, to midsize businesses, even to larger businesses.

“Bahamas Development Bank will be providing funding, I don’t know what the exact dollar amount in the portfolio is going to be, my understanding is close to $30m. I don’t know the entire 30 million is going to be useful renewables, I know it’s for environmental use. But again, we’ve been advised that the loans will be done at 100 percent, I’ve asked for a period of no shorter than 15 years, up to 25 years.”

He said the renewable systems would be 100 percent financed and can be deactivated remotely so business owners can be disconnected if they default on their payments, which are to be made monthly replacing their Bahamas Power and Light (BPL) payments.

He said: “So at 100 percent financing, very attractive rates, they will consider the system as collateral, because we can control the system remotely. So if the homeowner for example, doesn’t make their payments, over whatever period of time, they look at delinquency, we can remotely shut the system down. So then the homeowner doesn’t get the benefit of independent power until they settle that bill.

“Essentially, the plan is to replace the BPL cost to the homeowner with the cost of the system on a monthly basis. So what they intend is that we put in a system, the homeowner borrows from Bahamas Development Bank and that repayment to Bahamas Development Bank is going to be lower than what they’re paying to BPL at this time and they have consistency of power.”

He said all businesses need consistent power generation to operate effectively and renewables can be used to provide reliable, environmentally friendly service around the clock.

He said: “For a business, you need consistency of power to operate. So if there’s an issue with consistency of power, then there has to be an address for that, there has to be a solution for that. One of the solutions would be with the use of renewables because we can provide power to that entity 24 hours a day, guaranteed.

“So that entity doesn’t have to be without power. We can we can put in a battery-based system, which can operate independent of the utility. It can be grid tied to the utility, but the utility can be there as a backup, if anything happened to the solar system, but primarily the business establishment will own their own power.”

He said that although the government has set a target of having 30 percent renewable power generation by 2030, the country is currently operating on about 10 percent and noted that access to financing has been a major barrier for many individuals that are interested in converting to renewables.

“The government has set a target of 30 percent renewables by 2030, we’re now at 2024 and I think our penetration is still less than 10 percent, so we still have a long way to go. Alternative Power Sources is prepared to step up and play the role that we need to play as a distributor, as a supplier and as a contractor,” said Mr Gilbert.

“Well, one of the things that is has come to light in the last couple of weeks is that financing has always been an issue in the growth of renewables in the country because most people don’t have the ready cash to pay for the systems. “

He said traditional banks have shied away from providing loans for renewables as they do not meet their collateral requirements and cannot be easily repossessed for non – payment.

He said: “The traditional banks have been reluctant to lend money for renewables because traditional banks need collateral. When you get a house, the house is the collateral when you buy a car, the car’s collateral. If you don’t pay your mortgage or you don’t pay your car note, the bank can take it from you with renewables it’s different, once we install, it’s on the structure. So it’s not about going to the homeowner and removing that for non payment.

“So traditionally, the banks have stayed away from renewables because of their collateral requirements.”