Solving Haiti’s energy challenges may require diversification; Effective energy use in Haiti remains elusive
By Sam Bojarski
Last February, Jacques Bingue and some friends sat down to eat at a seaside restaurant in Cap-Haitien. Not long after they arrived, the lights suddenly went out, he recalled. The staff remained calm, apparently unfazed by the occurrence. It took them about three to five minutes to turn on the restaurant’s backup generators, Bingue said.
Throughout Haiti, especially outside the capital of Port-au-Prince, the electricity grid is unreliable. This has produced impacts that range from inconvenience to human tragedy.
According to Wadson Desir, who currently lives in Laboule, the lack of lighting adds to the insecurity people often feel at night. Hospitals fail to accomplish basic tasks, and “people (have) passed away in an operating room because of a sudden black out,” he said.
Haiti also relies on relatively expensive sources – diesel and heavy fuel oil – for electricity. Meanwhile, deforestation threatens to deprive the country of wood, an energy source widely used for cooking fuel.
“Energy is one of the resources that you must use effectively if you want to have a decent quality of life,” Bingue said. “Haiti has never done that.”
Haiti’s energy mix
Only about 30 percent of Haiti’s population has access to the electrical grid, according to Bingue, a Haitian native who currently serves as chief technical officer for Group Citadelle, a Haitian-American organization dedicated to solving Haiti’s energy challenges.
With electricity scarce, Haitians derive 70 percent of their energy from wood, he added. The average citizen spends half their income on wood-based cooking fuels, according to a report published by Innovative Energy Solutions (IES), an energy research company Bingue founded. The report detailed Haiti’s energy challenges and explored a potential solution, which combines the use of coal with the manufacture of charcoal briquettes.
The reliance on charcoal and firewood for over 200 years has had consequences. Researchers at Oregon State University found that 99 percent of the country’s original wooded areas have been deforested. According to the IES report, roughly half the country’s charcoal need is now imported from the Dominican Republic.
It isn’t the only imported energy source. Rene Jean-Jumeau, director of the Haitian Institute for Energy, a nonprofit, nonpartisan organization, said 80 percent of Haiti’s grid-based electricity comes from imported diesel and heavy fuel oil. A hydroelectric power plant in Peligre generates a significant portion of the remaining 20 percent.
The Peligre plant produces cheap electricity, when it is working, Bingue said. But refined fossil fuels continue to dominate electricity generation.
“Diesel plants are very easy to install and very quick to install, and so there’s always political pressure to develop the capacity and not a lot of money. So it’s cheaper to install a diesel plant in terms of capital, and then it’s extremely expensive to run it over the years,” Jean-Jumeau said.
Energy and the economy
Haiti has two major thermal power plants, in Carrefour and Varreux. Numerous smaller plants around the country run infrequently, due to fuel costs, Jean-Jumeau said.
According to Bingue, Haiti has about 373 megawatts (MW) of installed capacity, although much of it is unreliable.
“Bear in mind that less than 250 are available at any time,” Bingue said. Due to faulty power lines and theft, the collection rate on electricity bills is less than one-third, he added.
Jean-Jumeau pointed to the challenges that all Caribbean island nations share, in having to import most of their energy.
But Bingue said Haiti’s real electricity costs are high compared to countries of a similar size, like the Dominican Republic.
“Bear in mind that Haiti’s electricity is subsidized to the tune of up to $250 million/year. Thus, one has to calculate the real cost (subsidies included). With oil at about $52/bbl, the real cost amounts to about 37 cent/kWh,” Bingue said in an email.
Residents of the Dominican Republic, a country with almost the same number of people as Haiti, pay less than 20 cents per kilowatt hour, according to Bingue. The nation, which has an installed capacity of roughly 4,000 MW, uses diesel, heavy fuel oil, natural gas and coal.
According to the website Environment and Ecology, run by the Ecological Society of America, coal costs $1.96 per million British thermal units (BTU). Oil costs $10.96 per million BTU, with natural gas falling in between the two.
Due to its unreliability, most companies in Haiti do not even bother buying electricity from the national grid. Many use portable generators, which run on diesel fuel.
The cost of running these generators drives up the prices of products and hampers the ability of companies to create jobs, Bingue said. Haiti has an official unemployment rate of around 14 percent, but Bingue said well over half of Haitians are underemployed.
“For Haiti to generate jobs, to have a competitive economy, it needs to have competitively priced electricity … it is the first thing it has to do,” said Bingue.
Haiti’s low level of economic development has made it hard to finance additional electricity infrastructure. But at the root of the problem, Bingue added, is mismanagement dating back more than 200 years.
No money, no development
Recent allegations of mismanagement have provoked ongoing unrest since last summer’s proposed fuel price increase.
In Haiti, “everything is dependent on fuel,” said Desir.
Last July, at the behest of the International Monetary Fund (IMF), Haiti’s national government announced major increases in gasoline, diesel and kerosene prices. In response, protesters took to the streets, looting businesses and burning tires in roadways.
The outcry incited the government to back off its fuel price hike. But unrest has continued amidst persistent fuel shortages, and protesters have increased their calls for government accountability, denouncing the alleged misuse of PetroCaribe funds.
The PetroCaribe program, signed in 2006, gave Haiti access to discounted oil from Venezuela. Under the agreement, Haiti paid 40 percent of the cost up-front and would have a period of 25 years to pay the remaining 60 percent.
“The 60 percent we have to make development, create jobs, create employment, invest in agriculture, in all infrastructures,” said Desir, who has served as a local government official in Boutillier.
According to a report by The Canada-Haiti information Project, Venezuela planned to assist Haiti with electricity generation projects in Cap-Haitien and Carrefour.
But according to Haiti Liberte, from 2011 to 2016, the administration of former President Michael Martelly used nearly 75 percent of Haiti’s PetroCaribe money on projects that were not finished or did not exist. An investigation by the Haitian Senate alleged that officials in the Martelly administration misused $3.8 billion, the Associated Press reported last year.
“We don’t have the 60 percent saved, and no money saved and no infrastructures, no development … and people they get richer, like the people who rule the country they get richer,” Desir said.
According to Jean-Jumeau, PetroCaribe is currently dying, due to political and economic problems in Venezuela, as well as U.S. sanctions on its economy. Haiti now purchases fuel on the international spot market, he said.
The government, he continued, continues to absorb fuel price changes through its subsidy.
Recently, they have come up short in finding the money to pay fuel suppliers, including U.S.-based Novum Energy. The resulting fuel shortage caused a widespread electricity blackout in January.
“They don’t have enough money, enough funding to pay (for) the ship that has already been sent, so that’s the reason why people protest, we don’t have money saved,” said Desir.
Given the current political climate, Haiti cannot take away its fuel subsidies, Bingue acknowledged. But he suggested that the country bring down energy costs by breaking its reliance on imported petroleum.
“The way to get rid of the subsidies is to bring prices down … what you have to do is use a fuel that’s cheaper than diesel,” he said.
Group Citadelle currently has plans to build a coal-fired power plant in the northern city of Terrier-Rouge. It would power a nearby industrial park with a separate facility for manufacturing charcoal briquettes made of biomass and coal.
In addition to posing an alternative to wood-based fuel use, this plan could help the government reduce energy expenditures, which account for 25 percent of the country’s foreign exchange, according to the IES report. The report also noted that Haiti can save over $250 million per year by replacing current energy sources with coal and briquettes.
Although burning coal releases greenhouse gasses into the atmosphere, Bingue said it has helped other countries, like China, Vietnam and India, reduce poverty.
“Haiti’s biggest problem is poverty. Haiti does have an environmental problem, but its environmental problem is deforestation, it is not burning coal,” he said.
Given Haiti’s young and growing population, improving the quality of life for its citizens may require urgent action.
“In 30 years, the population is going to double, so that tells you that Haiti has to get out of poverty fast. If it does not, I don’t know what we are going to do,” said Bingue.