Potential of Electric Vehicles in Jamaica

Hi!

The following might be lengthy but it shows how if only 10% of Jamaican vehicles were electric operated how the country would be saving over $5 Billion Jamaican dollars per year.

 The tale of electric vehicles on Jamaican roads

Jamaica, astonishingly has 200-300 roads per 100km square, ranking it the fourth country in the world in respect to road density.  Our problem? Many of these roads are in a state of disrepair giving us nothing to boast. Having an efficient and effective transportation system is crucial to the economic and social development of a country and of course this is known by the Government of Jamaica (GOJ) as same is seen being manifested in the fact that the GOJ has embarked on a nationwide upgrading of the road network. Such a system is also vital if we are really serious about becoming an internationally recognized logistic hub. However, any good transportation system can still be improved upon by being, environmentally friendly while reducing the negative social and economic externalities associated with its operation, and this is where electric vehicles (EV) can come into play. The introduction of EVs would seek to plug a leak in our economy caused by some aspects of our transportation sector, while simultaneously saving the country $J5.9 billion per annum.

The future is as far or as near as we want it to be and whether or not we are prepared for it, it is coming. It is therefore my recommendation that EVs be quickly introduced to the Jamaica Automobile Industry/market, then to the Jamaican Public Transportation Sector; both of which, is currently entirely composed of vehicles with internal combustion engines (ICE).  This can be done by opening the door to EVs and Hi Performance Electric Vehicles (HPEVs) by encouraging and fostering their importation, sale, and use.

Although we will never be independent of imported oil we can incrementally make decisions and plans that will reduce our dependence. Presently, the transportation industry consumes about 21% of the oil that the country imports according to the 2009-2030 Energy Policy.

In order to start the introduction of EVs and HPEVs, I recommend that the government:

• Continue and fine-tune this discussion with all the relevant stakeholders
• Charge no importation taxes/duties on these vehicle
• Grant at least a 15% and 10% concession on all EVs and PHEVs and eligibility of same to all government employees and other customers respectively.  
• Ensure that a minimum of 10% of motor vehicle importation is allocated especially to EVs and a quota be placed on new and used ICE vehicles. Over the successive years the quota allocated to EVs should be increased by 2% each year for the next ten (12) years.
• Encourage the insurance companies to offer a lower insurance package on these vehicles as comparatively worldwide they are involved in less motor vehicle accidents.

No doubt an electric vehicle infrastructure will have to be built, however this investment can be made by members of the private sector, through Public-Private Partnerships (PPP), Direct Investments, Foreign Direct Investments (FDIs) or Build-Operate-Transfer (BOT). Such investments will create a new industry and cause an increase in economic activity which will positively affect the country’s GDP and attractiveness for further investments. Examples of investment options are as follows:  (1). Operators of paid parking facilities can install solar powered charging services to persons who own EVs at an additional cost. The cost being charged must be less than what the car owners would pay if they were to charge their vehicles at home. (2) Companies that offer free parking for their workers and customers can gain additional income by also offering solar powered charging services. (3) Hotels, Guest Houses and Motels can also offer charging services which may give them a competitive advantage. (4) Companies with a fleet of vehicles can save millions per year with changing them out for electric vehicles. (5) Taxi operators can offer a reduce price while enjoying an increased profit margin by using EVs. (6) Strategically positioned gas stations can also offer EV charging services.    

After the private sector, through the “steering” of government has put into play the EV infrastructure, then the GOJ can turn its attention to upgrading the JUTC fleet with electric buses. The JUTC is presently operating at a lost, however these loses can be drastically reduced if we follow countries like India, the UK, USA, Canada, China and Korea who have electric buses among the fleet of their public bus system. Each JUTC depot along with the Half-Way-Tree bus terminal can install solar and wind power charging capabilities for these buses. The present bus fleet can be sold to private bus companies and the revenue generated can be used to help offset the cost of buying a few of the new electric buses.

The benefits of this recommendation are, but not limited to:

(1) Jamaica will be placing itself in a position of becoming the country that has the most EVs vehicles per 100km square by 2030 if this recommendation is put in effect within the next two years. This will create an entirely new sector which will provide many new jobs and services.

(2) The manufacturers of EV and PHEV can be easily encouraged to view Jamaica as a viable market to do business and to invest in. When they accept, FDIs in the form of outlets, depots and assembly plants can be established in the country. Additionally, they can use same not only to supply the local market but also the Caribbean Region and to a larger extent the Americas. This would allow Jamaica to become a major transshipment port for EVs and PHEVs thus making the Automotive Industry a part of the logistic hub in a way that it had never thought of before.

(3) The technical capacity to build the infrastructure needed to support this new sector can be found in our local Alternative Energy companies. This move would boost the growth of the Alternate Energy Industry by leaps and bounds.

(4) One of the advantages that Jamaica and other small countries have in the adoption of electric vehicles is their size. The average electric vehicle travels 150km per charge, in the Jamaican context, that is roughly from one end of the island to the next. The average Jamaican commuter travels less than 100km per day going to work and back. In this regards, small countries have the comparative advantage over larger countries in the usage of EVs, making them ideal for the electric vehicle market.

(5) The increase in electric vehicles and the simultaneous and gradual reduction in ICEs on our nation’s roads will cause a decrease in the amount of pollution that the transportation sector produces thus reducing its carbon footprint. Our atmosphere will be greatly improved which will in turn increase the quality of life for our citizens. Additionally, an improvement in air quality, if properly marketed by the Ministry of Tourism can also help to improve our tourism product. Jamaica could advertise itself has having one of the best air quality in the western hemisphere.

(6) Jamaica will be consuming far less energy to operate the transport sector which uses 21% of the total oil imported. There were about 500,000 registered motor vehicles in Jamaica in 2008 according to the Insurance Association of Jamaica (there are more now). If 10% of this amount which is 50,000 were EVs the country would save approximately $5.9 Billion Jamaican dollars per annum on imported oil which is calculated as follows; On average Jamaican spends US$2.4 billion for oil annually, multiplied that by the 21% that the transportation sector uses, equals to US$504 million, then multiplied by the 10% (not using oil/gas) would equal US$50,400,000 or J$5,997,600,000.  This J$5.9 Billion worth of savings is at no cost to the GOJ or the people and will increase by 2% each year according to the recommendation above.

There are many more benefits to be gained from the introduction of EVs to Jamaican Automotive market and the above expressed is but scratching the surface. The road to economic recovery may be found among the many that we already have, but what is sure, is that traveling in an electric vehicle will improve our chances of getting there.