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HomeNewsArchivesWAPA’s Switch to Alternative Fuels Coming Sooner Rather Than Later

WAPA’s Switch to Alternative Fuels Coming Sooner Rather Than Later

From preparing for a groundbreaking next month that would begin the process of getting solar sites up and running in both districts to meeting with federal representatives about the possibility of integrating wind into its energy portfolio, the V.I. Water and Power Authority is pushing for a switch to alternatives as quickly as possible, according to officials.

“All sticks are in the fire for everything that’s going on right now,” WAPA Executive Director Hugo Hodge Jr. said Monday to the authority’s board during a meeting on St. Thomas. Hodge gave a variety of status updates on propane, natural gas and wind energy projects currently in the works for WAPA and said that more movement on the solar side will also be coming soon.

Last June power purchase agreements were signed with Toshiba International Corp., Lanco Virgin Islands I and Sun Edison LLC for a combined 18 megawatts of solar energy to St. Thomas and St. Croix, Hodge said. At the time, construction was scheduled to start during the first quarter of 2013 and to end by December 2013.

Hodge indicated during Monday’s board meeting that the timeline is still in place, as groundbreaking on both islands is expected to take place within the next month. Power purchase agreements are in place for all six solar sites – three on each island – where the panels will be set up and generating energy, Hodge added. He also said that approximately 100 jobs should be created during the construction phase, and about 25 or so permanent jobs afterward.

Another priority is signing a contract with a provider for liquefied petroleum/propane, which Hodge said could be completed sometime within the next few months. WAPA recently announced plans to convert to a tri-fuel system that could burn fuel, natural gas and propane in order to relieve the territory of its dependence on oil.

Earlier this year, WAPA announced that they were eyeing Trafigura AG, Vitrol and Geogas/Polaris as possible propane providers, while Pacific Rubiales, Gasfin, LNG Enterprises and Cheniere are in the running for possible liquefied natural gas providers. According to officials, the cost of liquefied petroleum/propane makes it an “attractive alternative” to fuel oil.

The successful bidder will cover the cost of converting WAPA’s current system, which should take about 18 months after a contract is signed.

“We are getting propane in place at the soonest point possible, which is next summer,” Hodge told the WAPA board Monday. He said any of the costs that would be covered by the authority will be amortized over the next five years, which would then allow WAPA to work on inking a contract for liquefied natural gas.

Hodge explained the time in between contracts would allow WAPA and its providers to make a comprehensive plan for accommodating both fuel sources.

He also explained that propane is available immediately, with vessels on the water making deliveries, while liquefied natural gas needs to be shipped in larger vessels that currently cannot berth in the territory.

“We expect that part to be available within the next three to five years and we hope, over time, that liquefied natural gas will be the fuel of choice in the territory,” Hodge said. “Of course, we have to try not to be dependent on one form of fuel but when we have three different types, we will be able to look at the markets more and buy what is most advantageous to us.”

Hodge has estimated that the switch to liquefied petroleum or liquefied natural gas could help drop LEAC (levelized energy adjustment clause) rates by approximately 30 percent.

Hodge also spoke about plans in the works to bring wind into the authority’s energy portfolio and talked to board members about meetings scheduled this week to begin the process of hammering out a potential request for proposals for interested providers.

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