Findings published in Energy Policy suggest electric utilities stand in the way of renewable technology
CALGARY, AB – For an area of the world that is known for its bright sunshine and breezes, the Caribbean produces surprisingly little renewable energy. Expensive imported diesel or fuel oil is used to generate most or all of the electricity on many islands — despite the abundance of sun and wind throughout the region, according to a press release.
A trio of Haskayne School of Business researchers at the University of Calgary wanted to know why because renewable technology in the Caribbean makes sense both economically and environmentally, yet its growth has been stalled.
In a new paper published in the current issue of the journal Energy Policy, Harrie Vredenburg, David Ince and Xiaoyu Liu conducted a large survey of 36 political jurisdictions in the Caribbean to uncover the factors that promote and restrict the development of renewable energy.
They conducted 12 island case studies, 75 in-depth interviews, as well as did surveys in English, French, Spanish and Dutch in 34 of the 36 jurisdictions to hear from businesses, governments, utilities and non-governmental organizations.
Their findings were surprising. In places where the incumbent electrical utility was most influential in policy making, there was a statistically significant connection to reduced renewable energy.
“So if an incumbent electric utility is heavily involved with government, advising government how to develop renewable energy policy, we find there is less renewable energy,” explains Vredenburg, the Suncor Chair in Strategy and Sustainability.
“Where the utility is kept more at arm’s length and is not as influential, and governments perhaps use external international expertise to advise them, or somehow come up with policies more independently, we find there is a greater amount of renewable energy.”
Vredenburg, who is also the academic director of the Global Energy Executive MBA program at Haskayne, says he was surprised by the finding because he believed, based on earlier research, that an electric utility company with a proactive role in pushing green technology would help spur renewables. In reality, that may not often be the case.
This research also sheds new light on why renewable energy development isn’t happening in an area already threatened by rising seawater and turbulent storms as a result of climate change.
Vredenburg notes that many Caribbean nations take the issue of climate change very seriously and are working together through organizations like the Alliance of Small Island States to fight climate change.
In January 2017, Vredenburg plans to present the findings to the South Pacific’s Cook Islands government officials. The subject formed the basis of Ince’s doctoral thesis and he also reported some of his findings last year in London’s The Guardian.
The study also looked into the factors that helped encourage green technology development and found that it flourished in places where cultures of ecology and entrepreneurship thrived.
On the day they visited Bonaire, an island in the Dutch Caribbean whose main industry is dive tourism, over 60 per cent of their energy was generated by wind. In Barbados, the use of solar water heaters is a common sight.
These findings corroborated earlier published studies done by Vredenburg and Juan Leonardo Espinoza, who also completed his PhD at Haskayne, in Costa Rica and Denmark where strong pro-renewables cultures exist.
Vredenburg says this research was inspired by Harvard ecologist E.O. Wilson, who developed the concept of island biogeography, as well as Douglass North, the Nobel winning economist who argued that economics is about more than numbers and includes the formal and informal institutions that make up a society.
Throughout their research, Vredenburg says the variety of experiences that make up the Caribbean — the cultures, legal systems and history of each place — provided a great opportunity to study how green policy is set.
He hopes this research will influence business and policy decision-makers in the Caribbean.
“The thing I hope they hear from this is: ‘Yes, use the technical expertise of the electric utilities, but be careful not to bring them in too close.’ They have a natural tendency and motivation to put the brakes on renewable energy, not because they’re nasty or anything like that, but it’s just that their current business is doing very well. Be careful of getting their technical expertise but not allowing them to run the show,” said Vredenburg.
Are these results generalizable beyond the Caribbean? ‘Quite probably,’ says Vredenburg. Just as ecologists studying island biogeography were able to generalize to isolated species populations elsewhere, he believes that the renewable energy study results from the Caribbean — in many ways a microcosm of the world’s political jurisdictions — may be relevant in other jurisdictions. But research in those jurisdictions to validate the model would have to be done to confirm this.