EDITORIAL - A resolution on jobs and energy

If Prime Minister Bruce Golding is given to New Year's resolutions, our suggestion is that his for 2011 - and the rest of his time in Government - be a rigid focus on job creation and policies to enhance the competitiveness of the Jamaican economy. Both of these, of course, are related - different sides of the same coin, even.

On the first of them, unfortunately, there has been a lack of urgency and creativity on the part of the administration in its more than three years in office. Karl Samuda, the industry, investment and commerce minister, has talked a lot, usually eloquently, about lessening bureaucracy and red tape that hinder entrepreneurship and industry. But there is little concrete to show for his torrent of words.

At the same time, the fiscal programme being pursued by the finance minister, Audley Shaw, under the tutelage of the International Monetary Fund, may be necessary. But they are contractionary without concomitant policy to stimulate the private sector-led growth.

Liquefied natural gas

These failures notwithstanding, in at least one area - the country's energy mix - discernible thought is being given to the matter of how to make the economy competitive. We wonder, though, whether the issue is being attacked from the strategically most appropriate front.

Recently, for instance, the Government's Office of Utility Regulation published a request for proposal (RFP) for 480 megawatts of power-generating capacity, with natural gas, delivered in the form of liquefied natural gas (LNG), as the preferred fuel. The administration's fuel preference carries 15 per cent weight for compliance with the RFP.

The Government's energy policy emphasises LNG primarily for three reasons: natural gas is cheaper than oil; it is relatively clean fuel, which makes it more favourable to those concerned about the effects of global warming; and, related to the second point, it is projected to grow substantially over the next two decades as a fuel source of choice.

This newspaper appreciates these considerations. We are concerned, too, about Jamaica's poverty, high rate of joblessness and underdevelopment.

It is in that context that we question whether our policymakers should foreclose on any fuel in the energy mix, and whether the country ought not to be flexible in the roll-out of power plants.

Sensible observations

Perchance that these observations are sensible, might it not be in Jamaica's interest, at this stage, to consider facilities that use the cheapest fuel so as to give our industry a fighting chance? In that case, Prime Minister Golding's task force over-seeing the implementation of the energy programme may wish to pause briefly to contemplate its options.

After all, at a production cost of around US$0.04 per kWh, coal-powered power plants in the United States (US) are half the cost of natural gas. Only nuclear power is cheaper.

Moreover, Jamaica, like much of the rest of the world, looks on with envy at the bullet-pace growth of China's economy - nearly 10 per cent this year. Most other countries can hardly muster a rev.

Incidentally, nearly 80 per cent of China's electricity is from coal-fired plants. Australia's is 77 per cent. For the world, it's around 45 per cent.

Just recently in Washington state, US, Cowlitz county approved the construction of a coal-export terminal. It will send coal to fuel China's growth.

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