Mar 31, 2021 News
…majority is exported to serve as country’s main economic pillar—Fmr. T&T Energy Minister
Kaieteur News – The bulk of the Natural Gas produced in neighbouring Trinidad and Tobago (T&T) has to be processed in some form or another and exported as Liquefied Natural Gas (LNG), ammonia or similar hydrocarbon products, since the country’s total electricity consumption, only uses about eight percent of its total production.
In fact, the 100 percent reliance on Natural Gas for its electricity generation has also since left T&T in a position, where its production far exceeds its peak demand.
Compounding the situation further, is the fact that the cost of producing that electricity is increasing, which will lead to an inevitable increase in tariffs to be paid soon by consumers.
This, not to mention the fact that the country has now embarked on a national initiative to produce more electricity through renewable mechanisms such as solar energy.
The revelations were had on Monday last, when the twin island republic’s former Energy Minister, Kevin Ramnarine, discussed Guyana’s proposed gas to shore initiative during an Oil NOW webinar and drew reference to his country’s experience, using gas for electricity generation.
The discussion comes on the heels of growing public debate domestically over the feasibility of the initiative.
Guyana’s Vice President, Bharrat Jagdeo has suggested that bringing gas to shore would reduce electricity by as much as half and as such, a feasibility study was not required, since the decision would be a ‘no brainer’.
According to Ramnarine however, only about seven to eight percent of Natural Gas produced in that country goes toward electricity generation.
The bulk of the natural gas produced, according to the former Energy Minister, is liquefied and exported while smaller amounts are used for ethanol production and ammonia production in addition to propane for cooking gas in T&T, among other uses.
“Natural Gas to electricity really constitutes about 7 to 8 percent of all” Natural Gas produced in the country…”the bulk is used to make LNG which is exported and that LNG business has really been the main pillar of Trinidad’s economy for the last 21 years.”
Trinidad and Tobago began utilizing natural gas for electricity general in 1953 and has since then become 100 per cent reliant on the fossil fuel.
He was adamant, “…electricity is a small subset of the natural gas use” in Trinidad and Tobago since the country first started to commercialize the resources in the 1950s—first for power generation and later for ammonia production.
The former energy minister expanding on the use of gas for electricity noted, that in T&T, there are four electricity-generating stations on the main island and another located in Tobago.
He disclosed however, “we have an installed capacity of about 2,100 (megawatts) MW in Trinidad and right now the peak demand in Trinidad is somewhere in the region of 1,350MW.”
Ramnarine explained to the moderator—Chris Chapwanya—“yes, we do have excess capacity in Trinidad.”
He said the excess capacity or glut in supply is underpinned by some key developments in the country over the past decade and cited as example the cancellation of an aluminum smelter
:“A power plant was built to supply the aluminum smelter and that smelter was cancelled.”
Ramnarine underscored too, that “we have had the closure of one of the major steel producers in the country…we have had the closure of the refinery in Trinidad, the oil refinery so that accounts for that big gap between installed capacity and what we call peak demand.”
As such, the former Energy Minister divulged that the T&T government is currently looking to now diversify its electricity production away from natural gas towards solar.
“To that extent there is a project that is being pursued jointly by BP and shell to build the country’s first solar farm,” Ramnarine said.
He noted that there are two such farms planned that will produce some 110MW of power.
The former Minister did point out that using natural gas to generate electricity in Trinidad did allow the country to sell the utility at about the second lowest rate in the hemisphere which has had its own spin off effects.
The low prices charged according to Ramnarine, “…has really underpinned the lifestyle so to speak, or a lot of the prosperity in Trinidad.”
He cited as examples the benefits to the manufacturing and industrial sectors as a result of cheaper electricity.
The former Energy Minister warned however, “the time is coming very soon when those rates will have to be revised.”
This, he said, has not been done in T&T in over a decade and that the cost of production over the years has been increasing.
“The time is coming very soon where I think it will become inevitable that we have to revise the electricity rates upward in Trinidad; their costs have been going up, but their revenue streams remain the same.”
Underscoring the feasibility of bringing gas to shore, Ramnarine intimated that such an initiative would only be commercially successful if it goes beyond electricity generation.
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