ROSEAU, Dominica, CMC—The Dominica government Monday defended its decision to seek a loan of over EC$100 million (One EC dollar = 0.37 cents) for constructing a 10-megawatt geothermal energy plant. The government says this is in keeping with its plans to accelerate the efforts to bring geothermal-generated electricity to the island’s grids by December 2025.
Finance Minister Dr. Irvine McIntyre told Parliament, where the ruling Dominica Labour Party (DLP) enjoys a significant majority that the International Development Association (IDA) of the World Bank is prepared to provide the loan for the project.
He told legislators that with all of the geothermal wells already in place and an agreement signed with the Geothermal Power Company of Dominica 2023 Limited for the financing, construction, and operation of the 10-megawatt geothermal plant in Laudat, a small village in the interior of the island, the government was seeking approval to borrow EC$109 million for the development of a new electricity transmission network.
He said the current electricity and distribution network, owned by the Dominica Electricity Company Limited (DOMLEC), needs more capacity to transport the electricity generated by the geothermal plants.
He said the new resilient network would transmit the electricity generated by the 10-megawatt power plant and can transmit the electricity from the three hydroelectric power plants in the neighboring Roseau Valley.
‘Furthermore, this network is designed to support future expansion of the geothermal power plant. DOMLEC also advised that it cannot incur the costs of developing the new transmission network, which is required, as the company has not yet recovered from the extraordinarily high costs it incurred in 2017 and 2018 to restore the network that Hurricane Marie destroyed in September 2017.’
McIntyre said the IDA, which he described as “one of our main partners in this venture, is prepared to finance the development of this new electricity transmission network.”
He said the new network would connect the Laudat geothermal plant to the Roseau Valley hydroelectricity plant and the DOMLEC substation at Fond Cole on the capital’s outskirts for distribution to DOMLEC’s customers.
“The terms are concessional and in line with the other IDB loans. That is, the interest is three-quarters of one percent per annum, the commitment charge is half of one percent per annum, there is a grace period of 10 years, and repayment is 60 semi-annual installments commencing May 15, 2034.”
He said the project to develop the new network is expected to be executed by the Dominica Geothermal Development Company on behalf of the government once completed. The government intends to enter into an agreement with DOMLEC to lease and maintain the new network.
“This loan has been evaluated in the context of the government’s medium-term strategy, and it is consistent with the objectives of that strategy,” McIntyre said, adding that “Dominicans have been eagerly awaiting the day when they could have stable electricity bills that are less dependent on the price of oil.”
He said the new initiative will also assist in generating investments and improving the island’s balance of trade.
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