Jamaica, a nation heavily reliant on imported fossil fuels, faces a pressing energy crisis that consumes 11% of its citizens’ income—triple the average in the United States. In a bold move to address this challenge, Prime Minister Andrew Holness signed a landmark Memorandum of Understanding (MOU) with Atomic Energy of Canada Limited (AECL) in 2024, aiming to develop small modular reactors (SMRs) within two decades to slash energy costs from $0.31/kWh and diversify the island’s tourism-dominated economy.
Prime Minister Holness hopes to reduce prices by developing small modular reactors (SMRs) within 20 years, bringing down energy costs from $0.31/kWh and reviving the industry. Phillip Paulwell and other opposition leaders support solar growth, pointing to successful 7¢/kWh bids and claiming that nuclear’s ten-year schedule won’t solve pressing economic problems. The 40-year-old SLOWPOKE-2 reactor in Jamaica serves as a reminder of the country’s nuclear capabilities, although it is not mentioned in energy-related talks.
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Critics point to grid constraints and legislative obstacles, such as a 2015 law that forbade nuclear power plants, while Holness portrays SMRs as a “quantum leap” to diversify an economy dominated by tourism and services. The debate reveals a country juggling immediate cost-of-living issues with long-term industrial aspirations.
Jamaica’s economic weaknesses were brought to light by Hurricane Beryl in July 2024, which resulted in a 4% decline in manufacturing by September. Families spent 11% of their income on power, which is triple the US average, and the situation was made worse by a refinery outage, a drop in cement output, and a decline in beverage exports. On October 22, 2024, Prime Minister Holness signed a nuclear energy accord with Canada to solve these issues, with the goals of lowering electricity costs, revitalizing industry, and reducing dependency on tourists.
“We are a service-based economy largely because the cost of energy is high. We have to figure out how to get the cost of energy lower in Jamaica so that we can build out more manufacturing-based industries,” Holness said to a crowd at the 20th annual Regional Investors and Capital Markets Conference held by the Jamaica Stock Exchange in Kingston in January. Manufacturing made up 8% of Jamaica’s overall production in 2023, while the services sector accounted for 70%.
Holness is adamant that “we have to solve the energy issue” in order to turn Jamaica into “an economic powerhouse.”
Although fossil fuels, mostly gas and oil, cost an average of US $0.31 per kilowatt-hour, they now power nearly 90% of the nation’s system. However, the most recent data from Statista.com, a global data and business intelligence platform, shows that the typical cost of electricity in the United States is US $ 0.18 per kilowatt hour, more than three times the average of US $ 0.11 paid in regional manufacturing hubs like Mexico.
With a declared goal of having at least 50% of the grid powered by renewables by 2030, the government has increased the integration of renewables into the grid and resorted to LNG in an effort to lower prices. About 12% of Jamaica’s total energy production as of 2023 came from renewable sources, primarily solar and wind. However, there are restrictions.
Hugh Grant, the president and chief executive officer of the national electricity distributor, Jamaica Public Service Company (JPSCo), stated during the January JSE conference, “Renewables by nature are intermittent, they are non-dispatchable, so renewables alone is not a solution to the energy future that is going to deliver for this great nation.”
Like Holness, Grant, who worked at a nuclear power plant in New York before coming back to Jamaica to manage the JPSCo in 2024, thinks that adding nuclear electricity to the grid might be advantageous for the nation. But he issues a warning: “However, we have to make sure that given the size of Jamaica, given the potential risks, that we do our due diligence around compliance, around maintenance, around the technologies and ensure that it is proven before we think of any adoption in terms of that.”
Holness said that Jamaica should be prepared to construct small nuclear reactors (SMRs) once the technology is proven, but acknowledging that renewable technology is advancing quickly and “not going to give you the quantum that you need.” It is now primarily developed in several nations.
Following Prime Minister Holness’s visit to CNL in October 2023 for the Caribbean Community Summit, AECL, CNL, and Jamaica signed a memorandum of understanding (MOU). Holness recognized nuclear energy’s “potential and the possibilities to bring an economic development and a great impact into Jamaica’s transition from fossil fuel to a greener type of energy,” according to Howard Shearer of CNL.
Power generation, waste management, and radioisotope applications are among the nuclear science and technology cooperation topics covered in the MOU. Knowledge transfer provisions are included for “possible exchange of scientists and other specialists…technical information and research results; and the possible organization of seminars and other meetings.”
Since 1984, Jamaica has run SLOWPOKE-2, the sole nuclear reactor in the Caribbean, to promote scientific, agricultural, and medical research. In addition to highlighting the reactor’s Canadian design and EU backing, Prime Minister Holness stressed Jamaica’s nuclear capabilities.
Small modular reactors (SMRs), tiny devices that provide safer, more affordable energy, are currently the main emphasis. With passive mechanisms for automatic shutdown to address safety issues, Holness characterized SMRs as having “enhanced safety features, reduced environmental impact, and a cost-effective solution for small countries like Jamaica.”
With projects totaling 268 megawatts, Jamaica is increasing its capacity for renewable energy. “You need long duration storage…currently, the longest you are getting is four to eight hours,” said Hugh Grant, a JPSCo official, pointing out the drawbacks of solar and wind power. That is insufficient to provide a robust and dependable grid. Because of this storage gap, “dispatchable” power sources—such as nuclear and fossil fuels—that run constantly are required, but alternatives like hydrogen mixing are being investigated.
Jamaica’s nuclear aspirations still face significant obstacles. The biggest is funding—international assistance is crucial because a 300 megawatt small modular reactor in Tennessee is expected to cost US$5.4 billion, but Jamaica’s GDP in 2024 was just US$20 billion.
Regulatory matters also provide difficulties. The HSRA was created by the 2015 Nuclear Safety and Radiation Protection Act, but it purportedly has restrictions that prohibit nuclear power plants; hence, revisions are necessary before projects can move forward.
Another layer of complexity is created by public perception, which raises worries about safety hazards. In November 2024, officials promised the public that there would be “minimum risk to human health and the environment” from nuclear exploration.
Nuclear development is a long-term endeavor that will probably take more than ten years, according to Prime Minister Holness. He gave the following explanation for Jamaica’s current nuclear pursuit: “Anything that has to do with nuclear requires a long period of time, and it requires the development of local capabilities. If you don’t do it now…you’re going to have to import the technological skills and expertise as well, which will increase the cost of deployment.”
Capacity building and knowledge acquisition are the main priorities at the moment. Even before nuclear electricity is used, Holness claims that the government’s partnership with Canada to teach Jamaicans nuclear technical skills will boost the country’s economy.
