Electricity shake-up sparks private sector applause

A major shake-up is on the horizon in Jamaica's energy sector, following the Government's formal notification to the Jamaica Public Service Company (JPS) that it does not intend to renew the company's all-island electricity licence under its current terms, when it expires on July 8, 2027.

Portfolio minister Daryl Vaz yesterday signalled the Government's intention to pursue sweeping reforms aimed at transforming the way electricity is generated, priced, and distributed across the island.

"The Government of Jamaica is determined that consumers of electricity in Jamaica should be placed in the best position to benefit from these developments. The current licensing arrangement 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. It is time for reform," Vaz said.

In response to the announcement, JPS President and CEO Hugh Grant expressed grave concern, describing the development as one with "far-reaching implications" not only for the company but for the future stability of the entire energy sector and the Jamaican economy.

"Regardless of the path forward, we assure our customers that JPS remains steadfast in our commitment to deliver safe, reliable, resilient and cost-effective electricity service to the nation," he said.

Meanwhile, the Government's decision has been widely applauded by the business community. In a joint statement, the Jamaica Chamber of Commerce, the Jamaica Manufacturers and Exporters Association, and the Private Sector Organisation of Jamaica commended the Government for its decisive action and echoed long-standing calls for structural transformation. The groups pointed to persistent challenges such as high electricity rates, ageing infrastructure, and staggering system losses as major impediments to growth and competitiveness.

"High energy costs have long presented a significant barrier to growth for businesses and an undue burden on households," the groups said.