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R 021548Z OCT 09
FM AMEMBASSY NASSAU
TO SECSTATE WASHDC 6709
INFO EC CARICOM COLLECTIVE

UNCLAS NASSAU 000605 
 
 
WHA/CAR FOR JOSLYN MACK-WILSON 
FOR BARBARA BRERETON, OPIC INVESTMENT FUNDS 
 
E.O. 12958:  N/A 
TAGS: ECON EFIN
SUBJECT:  Embassy Nassau Response to OPIC-Supported Global Renewable 
Energy Investment Fund 
 
REFTEL: STATE 095170 
 
 
¶1. (U) The following information is provided in response to the 
questions posed in reftel paragraph 5. 
 
1) The need for renewable energy capital in the Bahamian Market: 
 
The Bahamas is an archipelago with substantial potential wind, solar 
and wave/current energy resources that are well suited to Renewable 
Energy (RE) sector development.  Its unique geography consists of 
over 700 islands and 2000 cays - 24 of which are significant 
population centers.  The country enjoys a relatively high GDP and 
has a democratically-elected government which is stable and highly 
supportive of outside assistance for development projects. The 
technology sector in The Bahamas is well-developed, but small. 
Businesses in The Bahamas do not pay corporate taxes and established 
business owners tend to maintain excellent accounting records. 
Literacy is high and the business community is generally university 
educated (most have studied in the United States).  The nascent RE 
sector in The Bahamas is gaining momentum as more Bahamians perceive 
RE as a potentially profitable enterprise.  Customs duties for RE 
technology have recently been substantially reduced.  These 
conditions make The Bahamas an ideal location as well as an 
excellent testing ground for the USRG fund's targeted investment 
program in profitable companies. 
 
Public and private sector officials have frequently cited the need 
for The Bahamas to diversify its economy.  RE sector development is 
a potential source of employment for a country where the current 
unemployment rate is 17 percent.  An infusion of RE capital and 
expertise into The Bahamas for planned energy projects such as ocean 
thermal energy conversion, solar water heating systems, retrofitting 
of public buildings with RE systems, wind power assessments and 
biofuels generation would likely be welcomed and would boost the 
economy.  The success of private-sector RE projects in The Bahamas 
may further encourage the government-owned Bahamas Electricity 
Corporation to adapt to this new paradigm, thereby saving the 
government significant amounts of capital in fossil fuel import 
costs. 
 
The GCOB's National Energy Policy Committee recently released to the 
public its first report on the National Energy Plan.  This report 
outlines both short and long-term strategies for incorporating 
Renewable Energy (RE) technologies into the traditional fossil 
fuel-based energy infrastructure.  The report's "vision statement" 
explicitly promotes the development and use of RE sources and 
further commits to legislative reform in order to facilitate 
alternative energy use: 
 
"The Bahamas will become a world leader in the development and 
implementation of sustainable energy opportunities, by aggressively 
re-engineering our legislative, regulatory and institutional 
frameworks; retooling our human resources and implementing a diverse 
range of well researched and regulated, environmentally sensitive 
and sustainable energy programmes and initiatives, built upon our 
geographical (both proximity and diversity), climatic (sun, wind and 
sea), and traditional economic strengths (tourism and banking)." 
 
2) Availability of Funds from Other Sources: 
Since December 2008, the Inter-American Development Bank has 
supplied the GCOB with approximately $2,030,000 in funding for 
sustainable energy and energy efficient projects in The Bahamas. 
Although substantial, the IDB representative to the Bahamas told 
ECONOFF that The Bahamas will need additional financial support in 
order to achieve all of its RE objectives over the next 10 years. 
 
3) Local Reputation of the Prospective Fund manager: 
 
The prospective fund manager is not known to government nor 
private-sector officials in The Bahamas.