A consequence of the US embargo and its isolationist policies, Cuba has remained largely unknown not only to the US itself but also the rest of the world. But that is now starting to change as companies look to it for new business opportunities.
One of the first off the mark is the UK solar company Hive Energy, which has become the “first British company” to secure a major solar project contract in Cuba. The 50MW project will be the “first utility scale solar project” in Cuba, generating up to 93GWh of electricity annually after its intended completion in 2018.
According to a statement from Hive Energy, the contract marks Cuba’s serious efforts to clean up its fuel supply and move away from its dependence on foreign oil to a portfolio of wind, sun and sugar cane. The country’s power grid and plants also are costly and inefficient, as a consequence of its history.
“The country can definitely benefit from the inclusion of renewable energies in their energy matrix,” comments Bernardo Fernandez, Hive Energy’s director of operations across Mexico, Central America and the Caribbean. “The current prices that PV offers will not only clean up the generation but will also provide a much cheaper energy source than their current alternative.”
The national goal is to lower the cost of electricity from the 2013 rate of $21.10/kW to $17.90/kW by 2020.
Renewables in Cuba
The statement continues that Cuba has plans to spend $3.5 billion in the coming years to increase its supply of renewable energy. In 2015, 4% of Cuba’s electricity came from renewable sources and the goal is to increase the utilisation up to 24% by 2030.
IRENA’s Remap 2030 database details approximately 550MW of renewables in Cuba in 2015. This is comprised primarily of biomass (470MW) along with some hydro (61MW), wind (12MW) and solar (8MW).
Like all the Caribbean countries, Cuba has high solar potential. This is reflected in solar being the only renewable currently on the increase, up from 2.8MW in 2012, while the others are constant or declining such as biomass, which is down by 50% from the 2000 level.
Recognising this potential the Cuban government has built a manufacturing plant outside the city of Cienfuegos with a capacity of 14,000 photovoltaic solar panels. The first solar farm with 2.6MW capacity was opened at Cantarrana, near Cienfuegos, in 2013. A 4.5MW solar plant also has been constructed near the US naval base at Guantanamo and several others are under development, including a 3.6MW facility at Cienfuegos.
In January 2015, a $15 million loan was awarded from IRENA and the Abu Dhabi Fund for Development (ADFD) for a 10MW solar project.
The government’s goal is that there should be 700MW of solar capacity in Cuba by 2030, according to a February 6, 2016 Havana Times report.
The Hive Energy plant will be constructed for Union Electrica de Cuba (UNE) in the Mariel Free zone, a new port 50km west of Havana which has been designed to act as a regional hub for the island. The project will be similar in scale to the company’s 48MW Southwick solar farm, the UK’s largest on the Hampshire coast.
Opportunity for storage
Another British company, Commercial Funded Solar, is also starting to size up renewables opportunities in Cuba.
Through an agreement with the London listed Cuban specialist investment company, Leni Gas Cuba Limited, CFS will assess the potential for installing and operating renewable energy and hybrid solar/storage solutions in Cuba, according to an LGC statement.
CFS and LGC intend to lead the development and construction of each project with the funding coming from external investors. Under the terms of the agreement, CFS and LGC will share on a 50/50 basis the development, funding and construction revenues for each renewable power plant built, and share on a 75/25 basis the 10-20 year operational contracts for the systems.
“There is a real need for more energy supply in Cuba over the next decade as the country continues to grow its economy, and we see the renewable energy sector as an area the company would like to participate in,” stated LGC chairman David Lenigas.
CFS specialises in the installation of medium sized, renewable power and storage systems of between 30kw and 1MW.