Renewable energy: Pillar of the next Budget

The Prime Minister has recently lifted the veil on the orientation of the 2016-2017 Budget. While his predecessor had put much emphasis on research, Sir Anerood Jugnauth announced that his first Budget will focus mainly on different types of renewable energies. Government policy is to reduce our dependence on fossil fuels. The energy sector is in the news these days. The energy crisis is not here yet, but the fear of such an eventuality has been raised many times. There are already cases of frequent power cuts, plunging whole areas into darkness. The causes of which differ whether you are listening to the version of the Leader of the Opposition, Paul Bérenger, or the Minister of Public Utilities, Ivan Collendavelloo. The latest available official figures are from 2014 and show that energy demand peaked at 446.2 MW. A total of 2,937 GWh of electricity was produced in 2014, of which only 20% was from renewable sources, including bagasse. Between 2013 and 2014, the total volume of electricity produced rose from 2,885 GWh to 2,937 GWh. The volume produced from coal increased by 1,214 GWh to 1,259 GWh, or 3.7%. Diesel has contributed to the production of 1,076 GWh in 2013 and 1,079 GWh in 2014. Regarding renewable sources, production increased slightly from 594 GWh in 2013 to reach 596 GWh the following year. While electricity production from photovoltaic panels has increased ninefold, from 2.7 GWh to 24.6 GWh, hydroelectric production fell by 4.2%, from 94.8 GWh to 90.8 GWh. Wind energy also decreased from 2013 to 2014, from 3.6 GWh to 3.2 GWh. Also lower production from bagasse, from 473 GWh to 456 GWh. Note that bagasse produced 550 GWh of electricity in 2010 and 498 GWh in 2011. The decrease is due to a gradual reduction of the area under cultivation of sugar cane, causing a reduction in the volume of bagasse available for energy production. This trend will increase with the advent of Smart Cities, as this will result in the accelerated conversion of agricultural land. However, this will be offset by greater production of green energy in the new cities. Studies Three reports are in preparation: The ‘Long Term Energy Strategy 2016-2030’, the ‘Renewable Energy Master Plan 2016-2030’ and the ‘Energy Efficiency Master Plan 2016-2030’. The government appointed Maxwell Stamp Consultant, UK, to assist in the preparation of these reports. In past, there were other reports, namely, the ‘Energy Strategy 2011-2025’, the Outline of Energy Policy 2007-2025 and the ‘Long Term Energy Strategy 2009-2025’.   [[{"type":"media","view_mode":"media_large","fid":"14171","attributes":{"class":"media-image aligncenter wp-image-23553","typeof":"foaf:Image","style":"","width":"651","height":"167","alt":"electricity-production"}}]]   Frankie Tang: “Boost the energy sector with new measures” Frankie Tang, economist, has made a series of proposals for the renewable energy sector. According to him, this important sector stalled because of the lack of incentives to the general public. “It's actually an opportunity for the Prime Minister to come up with some interesting measures to encourage the population to adopt renewable energy. We have two situations. Companies want to invest in large scale energy generation and then sell energy to the CEB. On the other hand, Mauritian households want to generate their own electricity to reduce their monthly bill. Some plan to sell surplus production to the CEB,” he explains. For the economist, many people see no benefit in installing solar panels on their homes because they have to invest too much to derive small benefits. “It is so much better to pay the electricity bill rather than investing in expensive equipment! We need extraordinary measures to boost the sector. Several activities are concerned, and they have the potential to create jobs,” he said. Measures The economist argues that we must create a market for the equipment needed in order to encourage assembly plants in Mauritius for the local market but also for export. Greater production of renewable energy will reduce the pressure on the CEB. To achieve this, he proposes these measures:

• Remove VAT on renewable energy equipment (solar panels, etc.)
• Tax deduction equivalent to the amount of investment, with the possibility of carrying over five years maximum
• Encourage the assembly of equipment in Mauritius by attracting local entrepreneurs but also foreign ones
• Train technicians to ensure qualified maintenance staff
• Offer grants to places of worship and NGOs to go solar
• Make the installation of solar panels mandatory for all new constructions, residential or other, exceeding 200 square metres, as a condition for the issue of Building and Land Use Permit
• Amend the ‘Morcellement Guidelines’ and other plans such as ‘Property Development Scheme’ to make partial use of solar energy compulsory
• Create ‘Energy Clubs’ in schools to educate young people about the importance of renewable energy
• Equip new residential projects of NHDC and MHC with solar panels
• Continue with the subsidy system for solar water heaters

Investment opportunities The energy sector provides many investment opportunities. The government wants to attract investors to build wind farms and solar farms in Mauritius. A wind farm is already operating in Plaine des Roches. With 11 wind turbines with a capacity of 9.35 megawatts each, equivalent to the consumption of more than 10,000 homes, this is a Rs 800 million project by French firm Quadran in partnership with the SIT. Furthermore, a solar farm, Sarako operates in Bambous. With an investment of 1.2 billion roupies, this farm has a capacity of 15 megawatts. In Mare Chicose, Sotravic is engaged in the conversion of energy into gas from waste. Other projects include the use of cool deep ocean water for air conditioning. Geothermal energy is currently being studied. The renewable energy sector still has opportunities in these segments. Production and assembly of equipment is a niche area that the authorities intend to promote in the manufacturing and light engineering sectors. Thommy Philogene: “Subsidise solar panels” The director of Greentech Ltd, specialising in solar water heaters and photovoltaic panels, favourably welcomes the announcement of the Prime Minister. Thommy Philogene says this is a good decision for the country if more emphasis is laid on renewable energy. “The country will benefit. Our neighbour, Réunion Island, is very advanced in this field. We will have to do the same. This sector is also important for the development of SMEs,” he says. He also proposes that, as with solar water heaters, government offers subsidies on the purchase of green energy production facilities to encourage people to adopt this new technology.