The Dominican Republic is the country with the highest consumption of fossil fuel derivatives in the entire Central American and Caribbean region. It does not produce crude oil and only processes 25 % to 30 % at the state refinery (Refidomsa). It is preparing to achieve an “energy mix” with a large percentage of clean energy in compliance with the Sustainable Development Goals (SDGs) and the Cop26 climate summit in Paris.
However, today in electricity and transportation the main energy sources are still coal and fossil fuel derivatives. As well as in transportation (air, sea and land). That is why it is time to explore the technology of the future, Green Hydrogen, so as not to be left behind.
Countries in the Latin American region such as Mexico, Chile, Colombia, Peru, Costa Rica, and Argentina are moving into H2V to advance the use of clean energy.
Problem. The Dominican Republic has in its energy strategy to reach 25% or 30% of renewable sources by 2030 and is expanding the mix with clean energy, but still has no plan to introduce H2V Green Hydrogen.
The Dominican Republic is not a producer of crude oil or fossil fuel derivatives, however, it is the largest consumer of hydrocarbons in the entire Central American and Caribbean region.
According to data from the Ministry of Industry and Commerce and Mipymes (MICM), just before the Covid-19 pandemic, in January-May 2019 in the Caribbean country the monthly average in millions of gallons of Liquefied Petroleum Gas (LPG) consumption was 40, 214, 868.
In the case of premium gasoline the monthly average in millions of gallons was 19,670, 972, and in regular gasoline 14, 609,142 million gallons, and 222, 232,111 million gallons of regular diesel oil that, in total with other fuels the average consumption of the first five months of 2019 was 624, 312,847 million gallons.
Currently, most energy generation is produced with coal and there is interest in changing it to natural gas in the future, an investment that besides being costly the country also does not produce gas domestically and it has to be imported.
Russia’s war in Ukraine has exposed the need for countries to produce for self-consumption.
General Objective. Execution in Public Private Partnerships (PPP) and the support of the Government with public incentive and follow-up policies to obtain financial resources from multilateral entities such as the IFC, the World Bank and the Green Fund of the European Union.
Define the percentage to be decarbonized and the time the pilot will take to achieve this goal.
A pilot in the Tourism Development Project of Pedernales would be ideal, given that the area is semi-arid, it is the seventh largest in territory and can advance according to the progress of the project which has been scheduled for 11 years and will be the first eco-sustainable project.
Specific objective. Generate interest in Public Private Partnerships (PPP) to develop a pilot in the Tourism Development Plan of Pedernales, currently prioritized by the Dominican Government to promote a new model of sustainable luxury tourism, low density, given the fragility of the area that has between 66% and 68% of protected area.
In other words, it is an area that, in addition to being a mining area, is rich in nature, but over the years has become one of the most impoverished in terms of income.
In Cabo Rojo, Pedernales, a province located in the south of the Dominican Republic, which borders Haiti and is in development to be the first low-density sustainable luxury destination due to its fragility and location of important protected areas and a wind source with two parks such as Los Cocos and Larimar.
The location of Pedernales and the Enriquillo region, which includes several provinces in the southern part of the Dominican Republic, is the most suitable for the production of wind energy, in addition to the fact that it is on the coast, with the sea “at its feet”, which could also serve as a green hydrogen system in the future.
Identify the amount of H2V to be produced in the 1-year pilot and the international entity that will provide technical and financial support, such as the World Bank.
Identify the financial source with soft rate and government support through the Ministry of Energy and Mines (MEM) and the National Energy Commission (CNE), entities that will elaborate the regulations for the implementation of new technologies and execute new incentives for private investors.
Involve the general direction of APP for the granting of incentives, the National Council of Free Zones (CNZFE) for approvals of incentives in case of export of this type of energy in the future; Border Development, to take advantage of the incentives given by Law 28-1, of border development and the Ministry of Tourism, which also facilitates new hotel projects with incentives.
Develop an impact study, based on a SWOT analysis, to balance the risks and cost of the technology. Involve the Academy of Sciences and the National Council on Climate Change and Clean Development Mechanism for any observations, since in the Dominican Republic it has been identified that the greatest greenhouse gas effect is generated 61.90% by energy, 19.10% by agriculture, 12.90% by waste and 5.30% by industrial processes.
Focus on cost reduction and make the project competitive given the high price of H2V production, look at regional experiences in similar markets, ensure follow-up and technical support from organizations such as the World Bank and the International Energy Organization, and train local personnel in the area.
Create within the Government (MEM and CNE) a special area to follow up on the proper execution of H2V projects, with a quick window to apply incentives and channel permits to the Ministry of Environment and National Resources and the Ministries of Public Works and Communications and Finance.
a) Conduct a feasibility study to determine cost/competitiveness of one wind and one natural gas and one seawater or offshore solar project to offer to investors. At the Government’s expense.
b) Apply all types of collaboration for the competitive development of H2V in activities focused on tourism, mining, land transportation (bicycles, engines, cars, buses, trucks, internal flight airplanes in DR, etc.), maritime (catamarans, boats, monorail, etc.), and in other metalworking industries. ) and in other industries of metallurgy (steel), agro-industry (to make fertilizers); chemical (to produce methane), that want to locate in the zone and generate or use this type of energy and thus lower the cost of production that today oscillates between US$1.8. US$3 and US$5 per kilowatt (kW).
The idea, according to experts, is to lower the cost of producing H2V to US$0.5 and US$1.5 per kW. The H2LAC platform (https://h2lac.org), with support from the German agency GIZ, the World Bank, ECLAC and the European Union’s Euroclima, is the best source of training and guidance on the subject.
Note…In the Dominican Republic it is also possible to start a pilot project of H2V from natural gas, because there is a large presence of the fuel through the multinational AES Dominicana with its terminal. And, another natural gas (NG) terminal will be opened in the community of Monte Cristi, in the northern part of the Caribbean country.
See the opportunity of underground storage and the regional agreements of countries in the Latin American region that are venturing into H2V.
What is hydrogen?
Hydrogen is based on the process of electrolysis from fossil fuels such as natural gas. It is not an energy source and therefore requires fossil fuels as a primary source, according to experts. It is also introduced with solar energy and seawater. It has been used in the chemical industry and refineries for more than 100 years.
Some 96% of hydrogen is used with natural gas and coal and 4% with electricity, explains José Fuster Justiniano, of GIZ-4e Chile.
There are different types of hydrogen (gray, blue, green). The low cost of renewable energy has motivated the promotion of this industry as a spearhead to reduce greenhouse gases and decarbonize important sectors of the economy such as the steel industry, transport in general, industries and electricity production, mining and cement, among others.
Green hydrogen is produced with renewable energy, gray hydrogen with natural gas and blue hydrogen with fossil fuels.