Industry experts say that although renewable energy would be beneficial to the Caribbean region, more needs to be done to make it viable.

According to the Caribbean Renewable Energy Survey 2010 conducted by financial services firm KPMG, 75 per cent of regional countries polled, including The Bahamas, say national governments need to take the lead in pursuing renewable energy interests, while 74 per cent believe that government subsidies are required.

Joost van Beek, KPMG advisory Caribbean’s corporate finance director says: “Eighty per cent of respondents believe the Caribbean region is lagging behind in renewable energy implementation compared to several other countries in the world …one of the most critical aspects is financial engineering. It’s very important we get a supportive framework for financial feasibility.”

Although the survey shows that 80 per cent of countries polled believe they should develop renewable energy to help the Caribbean obtain security over the region’s energy supply, which could consist of anything from solar power to wind turbines, 67 per cent rate their country’s performance in developing renewable energy as “poor.”

Charles Galante, managing partner of New York-based Real Infrastructure Capital Partners LLC notes that numerous island nations face regulatory issues when trying to develop or implement renewable energy strategies. “Very few island nations have a viable long-term framework. There needs to be more confidence in the sector.”

Generating funds to finance renewable energy projects is another issue the survey addressed, with more than 50 per cent of respondents saying they believe banks will lend to renewable projects given the right conditions. However, less than 20 per cent say that renewable energy is too expensive to develop industrially in the Caribbean.

Michael Murphy, vice president of renewable energy services for HDR Engineering Inc, explains that uncertainty in regulatory and new technologies is a road block to attracting investments for development.

“The biggest challenge is the uncertainty,” he says. “ We need to reduce that to attract investors and capital–these points are not unique to the Caribbean area.”

Nonetheless, for a region that boasts more than 300 days of sunshine annually, 85 per cent say solar power is the most suitable technology and should be explored further.

Asier Aya, Abengoa Solar’s photovoltaic North American division director, notes: “Solar technology requires stable, special regulatories” before projects can move forward. “Mechanisms to finance plants are necessary with support from either international development agencies or banks.”

An example of financial support is the $1.45 billion conditional commitment Abengoa Solar received from the US Department of Energy that will support the construction and start-up of the Solana power plant project in Arizona. When completed, it will be the world’s largest solar power plant with enough power output supply for up to 70,000 homes.

“There’s great ambition to implement renewable energy in the region and a wealth of opportunity out there,” says van Beek.

Adds Murphy: “We need creative thinkers at the policy and development standpoint. We need to understand our need for energy and how resources can be applied to the technology.”

Full results of the KPMG survey will be published at the end of the year.