Caribbean Energy: Macro-Related Challenges
IMF Working Papers, March 8, 2016
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- Caribbean Energy: Macro-Related Challenges
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Bibliographic details
- Authors: Arnold McIntyre, Ahmed El-Ashram, Márcio Valério Ronci, Julien Reynaud, Natasha X Che, Ke Wang, Sebastian Acevedo Mejia, Mark Scott Lutz
- Published: March 8, 2016
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781513560908.001
Summary
- High energy costs contribute to dampening Caribbean competitiveness and potential growth.
- The paper overviews power sector challenges and takes stock of national and regional strategies to address them.
- The analysis focuses on macro-aspects of energy reform, including:
- quantitative assessment of the impact of energy costs on growth and competitiveness;
- evaluation of gains from implementing announced renewable energy and energy efficiency targets;
- analysis of the impact of energy investments on debt sustainability.
- The paper argues for a bigger role for the private sector in energy reform and discusses prerequisites for good public-private partnerships.
Major findings and analysis
- High energy costs are identified as a drag on competitiveness and potential growth in Caribbean countries.
- The paper provides an assessment framework linking energy costs to macroeconomic outcomes (growth, competitiveness, and debt sustainability).
- It evaluates the potential gains from announced renewable energy and energy efficiency targets.
- The analysis includes examination of energy investments and their implications for debt sustainability.
Policy recommendations
- Advance energy reform with greater private sector participation.
- Design prerequisites for good public-private partnerships (PPPs) to support energy sector reform.
- Implement announced renewable energy and energy efficiency targets to realize gains in competitiveness and cost savings.
- Consider macroeconomic implications (growth and debt sustainability) when planning and financing energy investments.
Subjects and keywords
- Subject: Economic sectors, Energy prices, Energy sector, Environment, Oil prices, Prices, Public debt, Renewable energy
- Keywords: capital cost, Caribbean, core inflation, cost saving, Debt Sustainability, Economic Growth, electric energy, Energy Efficiency, energy efficiency cost curve, energy investment, Energy prices, Energy Reform, Energy sector, financing terms, fuel cost recovery mechanism, generation cost assumption, Global, Infrastructure, net exporter, oil price, oil price development, Oil Price Shocks, Oil prices, PPP, Public Investment, recovery mechanism, Renewable Energy, WP
Source: IMF Working Paper "Caribbean Energy: Macro-Related Challenges" (Working Paper No. 2016/053), March 8, 2016.