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Saint Kitts and Nevis The two islands of Saint Kitts and Nevis make up the Federation of Saint Christopher (often referred to by the abbreviated form, Saint Kitts) and Nevis, and are located in the Lesser Antilles of the Eastern Caribbean. In this section, “the Federation” will be used to refer to the country of Saint Kitts and Nevis, and the names of the islands will be used to refer to the islands as separate geographic and administrative entities. The islands of Saint Kitts and Nevis are separated by three kilometers at their nearest point. Nevis has a large degree of autonomy from the Government of Saint Kitts and Nevis; it has a separate premier, legislative body, and budget. The local government in Nevis is called the Nevis Island Administration (NIA).308 There is a two-phase plan for developing geothermal resources in Nevis. It includes developing a power plant to serve Nevis in a first phase, and another power plant in Nevis to serve Saint Kitts in a second phase. We present the two phases in this section. Phase 1 is also called the Nevis project, and Phase 2 is also called the Saint Kitts project. Phase 1 of the project has advanced considerably. Test wells drilled in Nevis suggest the existence of a geothermal resource large enough to power the two planned plants. The NIA has signed two project agreements.309 The NIA signed a concession agreement with a consortium of private companies for the development of a 10 MW power plant for Phase 1.310 The concession was competitively procured. The NIA and the consortium also signed a 25-year PPA with NEVLEC.311 Furthermore, the NIA has established the legal and regulatory framework necessary for developing the country’s geothermal resources. The government and the NIA could develop Phase 2 using the geothermal resource in Nevis, either with the same private partner as for Phase 1 or with another qualified partner. In Saint Kitts, geothermal development has not advanced beyond early surface exploration and results suggest a lower- 14 quality resource than that found in Nevis. However, the government did complete an interconnection study that identified three potential routes to supply electricity from Nevis to Saint Kitts. There are two sets of key actions that need to take place towards developing geothermal power in the Federation. On one side, the project developer for Phase 1 needs to carry out exploratory drilling. On the other, the government would need to carry out studies to determine the viability of building interconnection cables to transport electricity from Nevis to Saint Kitts for Phase 2. The government would also need to finalize any pending agreements for Phase 1 and reach agreements to implement Phase 2, either with the developer of Phase 1 or with another partner. The multilateral development banks can play an active role by providing funding for both phases. The planned project and possible role for the multilateral development banks is described in more detail in the following sections: • Overview of the Electricity Sector in Nevis (Section 14.1) • Overview of the Electricity Sector in Saint Kitts (Section 14.2) • Status of Geothermal Development (Section 14.3) • Recommended Financial and Legal PPP Structure (Section 14.4) • Recommended Changes to the Legal, Institutional, and Regulatory Framework in Nevis (Section 14.5) • Recommended Changes to the Legal, Institutional, and Regulatory Framework in Saint Kitts (Section 14.6) • Economic and Financial Analysis of the Geothermal Project in Nevis (Section 14.7) • Economic and Financial Analysis of the Geothermal Project in Saint Kitts (Section 14.8) 308. Ernie Stapleton, “Renewable Energy Development on Nevis: Lessons Learned” (June 28, 2010), accessed November 12, 2014, http:// www.credp.org/Data/CSEF2/Wednesday/pdf/Stapelton-Presentation_on_Renewable_Energy_Development_on_Nevis.pdf. 309. Nevis Island Administration, “NIA, NEVLEC and NREI Sign Geothermal Power Purchase Agreement,” November 26, 2015, accessed December 4, 2015, http://www.nia.gov.kn/index.php/news-4/news-articles-3/2538-nia-nevlec-and-nrei-sign-geothermal-power- purchase-agreement. 310. “Nevis Island Administration (NIA) and Nevis Renewable Energy International, Inc. (NREI) Sign Geothermal Concession Agreement,” Nevis Pages, September 3, 2014, accessed November 12, 2014, http://www.nevispages.com/nevis-island-administration-nia-and- nevis-renewable-energy-international-inc-nrei-sign-geothermal-concession-agreement/. 311. Nevis Island Administration, “NIA, NEVLEC and NREI Sign Geothermal Power Purchase Agreement,” November 26, 2015, accessed December 4, 2015, http://www.nia.gov.kn/index.php/news-4/news-articles-3/2538-nia-nevlec-and-nrei-sign-geothermal-power- purchase-agreement. 142PDF Image | Unlocking Geothermal Power Eastern Caribbean Powerhouse
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