Before the early nineties, both the power and water production and also the water distribution were responsibilities of a government department, while power distribution was the responsibility of a privately owned company.
In 1990, Government of Aruba, as sole shareholder, established Utilities Aruba nv, which later would become the holding company, for both power and water production and distribution. The existing government department was made a “self-reliable”, company, named WEB Aruba N.V., while the majority shares of the private company, N.V. Elmar, were acquired.
Initially, Utilities became the liaison between Government and working entities, and acted mainly, as a guarantor and/or to guarantee the loans of these entities. Before 2009, shareholders were not involved in any vision and/or strategy for power production and distribution. The strategies of the working companies were solely a management responsibility, according their statutes.
Period after 2009
In 2009, the government, and ultimate shareholder of power and water production and distribution, on Aruba, envisioned a new strategy for its utility companies. By prioritizing the inevitable environmental concerns of a small island and also to move away from reliance on the fluctuations of the oil market, the new sustainable energy vision was created. Aruba may be one of the smallest islands with an international profile in the Caribbean, but this vision became “Aruba’s flagship policy aim” that was announced at the “Rio+20” conference, by the prime minister. This, 2020 sustainable energy target, to have a100% sustainable power production by 2020, became Utilities, leading role, supervising this energy transition towards her working entities.
Abundance of wind and sun, on the island, lead to the choice of both these renewable energy sources, but which also brought new challenges. Both these sources are intermittent power, so these investments in more sustainability, would also require investments for maintaining, reliability of the actual power production. Without the right framework, these investments could have endangered the affordability of actual energy tariffs. To resolve this energy trilemma, the framework “RAS”, was created in which the right balance between Reliability, Affordability and Sustainability is pursued. The right balance was only achievable if actual energy tariffs would remain the same, or even better reduced. To this framework “RAS”, we added, last year the “MEI”,(macro economic impact), to further enhance sustainability to the Aruban economy. We believe that our green initiatives will also lead to sustainable growth and wellbeing for our country and our citizens.
Past gains and future challenges
Huge efficiency gains were made in power production, were the amount of barrels/day of HFO was reduced from 6200 (2005) to 3800 (2014). Normally the supply side is controlled by the demand side, but to gain more efficiency, supply should also be able to have control on the demand side. A “smart grid” could resolve this challenge, besides creating “time of use” with ice storage capabilities and/or charging of electric vehicle. Social adoption awareness programs would also make consumers, conscious of their energy usage. Distributed Generation (DG) regulations were stipulated and opened the possibility for consumers to install solar panels on their roofs, while any excess of energy, would be sold to the grid owner. Households and business were therefore no longer passive consumers of energy provided by the grid, but instead became energy “prosumers”. Other challenges to overcome was seeking the right mix of renewable energy and the much needed storage, but also, utility companies should start broaden their way of doing business, since with the above implementations of DG and awareness in consumptions will bring huge drops in their income.