KINGSTON, Jamaica – Science, Energy, Telecommunications and Transport Minister, Daryl Vaz, Tuesday said that the government may not be willing to renew the all-island license with the Jamaica Public Service’s (JPS) to supply electricity without re-negotiation of the current terms.
Science, Energy, Telecommunications and Transport Minister, Daryl Vaz, speaking at news conference on Tuesday (CMC Photo)Vaz, speaking at a news conference, told reporters that the license is due to expire on July 8, 2027 and that the Andrew Holness government is open to exploring other contracts with interested parties.
“I wish to assure the nation that the government’s serving of formal notice to JPS of its intention to acquire the license business augurs well towards stability in the electricity sector even as we negotiate terms which better serve the people of Jamaica.
‘There will be no disruption to service delivery prompted by our move to put ourselves in a position to secure better outcomes to the consumers. The license is very specific and the terms of the license and until 2027, those conditions are in place,” Vaz told reporters.
Vaz said he has already written to JPS in his capacity as energy minister giving “formal notice” of the government’s intention upon the expiration of the all-island license “not to renew under existing terms”.
He said the letter was written in keeping with the license agreement “which provides the government of Jamaica to acquire the license business at the expiration of the terms of the license.
“Let me make it clear it is not the intention of the government of Jamaica to take charge of the operations of the JPS,” he said, noting that “prior to the expiration of the current license in 2027 we intend to renegotiate new licensing terms and conditions with potential investors which are favorable for the people of Jamaica”.
He insisted that the 20-year license had given the JPS the power to operate, was “flawed” resulting in “flawed service” and that under its current terms, the license has not served Jamaica well.
He said that the terms under the current license have yielded electricity prices which are amongst the highest in the region.
“There has been a significant global reduction in the cost of renewables. The government of Jamaica is determined that consumers of electricity in Jamaica should be placed in the best position to benefit from these developments.”
Vaz said the current licensing arrangements with the JPS does not provide sufficient incentives to bring renewables onto the grid at scale, and it provides for generation via imported fossil fuels which is not cost-effective.
“We are getting an opportunity to draw a line in the sand, learn from our mistakes on an even keel to get the best results,” Vaz said, adding he would deal with any dip in service quality by employing the strength of the Office of Utilities Regulation (OUR).
