By News Americas Business Editor
News Americas, MIAMI, FL, Weds. June 24, 2026: As global energy markets face renewed disruption and oil prices remain volatile, Caribbean nations are once again confronting a familiar challenge: dependence on imported energy.
From Barbados to Jamaica and across the wider CARICOM region, rising fuel costs continue to pressure consumers, businesses and governments. Recent tensions in the Middle East have highlighted just how vulnerable small island economies remain to events occurring thousands of miles away. Barbados Energy Minister Kerrie Symmonds recently warned that small island developing states are “feeling the pinch” of the latest energy crisis, noting that governments are struggling to balance rising energy costs with the need to contain inflation and protect consumers.
Yet, beyond the immediate crisis lies a larger question: Why is a region rich in solar, wind, geothermal, hydro and ocean energy resources still so dependent on imported fossil fuels?
The Caribbean’s renewable energy potential is significant. CARICOM has established a regional target of generating 47 percent of its electricity from renewable sources by 2027. The World Bank is supporting projects aimed at expanding solar adoption and energy efficiency, while the African Export-Import Bank has expanded its CARICOM financing mandate to $5 billion, including support for renewable energy and infrastructure projects.
The challenge is not a lack of resources. The challenge is execution. Unlike many larger economies, Caribbean nations must balance energy security, affordability and climate resilience simultaneously. Transitioning too quickly away from traditional fuels could create reliability concerns. Moving too slowly leaves the region exposed to repeated price shocks and supply disruptions.
For that reason, energy experts increasingly argue that the future is not an all-or-nothing choice between fossil fuels and renewables. Instead, the region may need a diversified energy strategy.
Barbados is pursuing one of the world’s most ambitious renewable energy agendas while continuing to explore domestic energy resources. Dominica is investing heavily in geothermal energy that could eventually reduce its dependence on imported diesel. Guyana and Suriname are emerging as major energy producers, while Trinidad and Tobago remains one of the Caribbean’s most important natural gas suppliers.
Together, these resources could form the foundation of a more resilient regional energy architecture. The deals already being signed across the region show what that diversified architecture could look like in practice. In Dominica, a 10 MW geothermal project reached financial close in September 2025 through a blended financing package arranged by the Caribbean Development Bank, with concessional capital from the Green Climate Fund helping clear bankability hurdles that had stalled Caribbean geothermal for years. Developed by a subsidiary of Ormat Technologies, the plant is expected to supply most of Dominica’s baseload demand once operational.
In The Bahamas, Renugen Pro Limited is advancing more than $40 million in hybrid energy projects across Cat Island, Long Island, and San Salvador – combining solar, battery storage, and natural gas under long-term power purchase agreements signed directly with the government. And in a sign of how seriously multinational energy companies are now treating the region, TotalEnergies expanded its partnership with AES across the Dominican Republic and Puerto Rico, acquiring a 50 percent stake in a combined 1.5 gigawatt portfolio of solar, wind and battery storage assets — one of the largest renewable energy commitments any global power company has made in the Caribbean to date.
Jamaica offers perhaps the clearest evidence that the economics already favor renewables. Recent power purchase agreements there have reached the US$0.09 per kilowatt-hour range for solar and US$0.12 for wind – both well below the cost of imported diesel generation – with prices expected to keep falling as more projects come online.
Yet even with these long-term contracts in place, the region’s overall numbers remain stark. According to the 2023 Energy Report Card for CARICOM member states, the region’s total installed capacity stands at roughly 5,777 megawatts – but only about 761 megawatts, or 13 percent, comes from renewable sources. Conventional fossil fuel generation still outweighs renewable capacity by nearly 74 percent across the bloc.
The model may be closer to the United Arab Emirates than many realize. The UAE did not abandon fossil fuels overnight. Instead, it used energy revenues to finance infrastructure, logistics, tourism, technology, and renewable energy investments. Caribbean energy producers now face a similar opportunity: use today’s oil and gas revenues to build tomorrow’s energy system.
The economics are increasingly compelling. As United Nations Secretary-General António Guterres has noted, “There are no price spikes for sunlight and no embargoes on the wind.”
Once renewable infrastructure is built, operating costs are generally lower and more predictable than imported fossil fuels. Solar, wind, battery storage and geothermal projects can reduce long-term exposure to geopolitical events while strengthening national energy security. The remaining obstacle is capital.
Renewable energy projects often require substantial upfront investment even though they generate savings over time. For many Caribbean governments, utilities and private developers, access to affordable financing remains one of the biggest barriers to accelerating the energy transition.
That financing gap is also creating opportunity. As governments and businesses seek to reduce energy costs, improve resilience and meet climate targets, demand for renewable energy financing is expected to increase significantly across the Caribbean in the years ahead.
The region may never be powered entirely by renewable energy. It does not need to be. The larger opportunity is to become far less vulnerable to the next global energy crisis than it is today. Every major energy shock reminds the Caribbean of its dependence. The question is whether this crisis will finally become the catalyst for a more diversified, resilient and energy-secure future.
The Rocky Mountain Institute estimates the region will need roughly US$11 billion in investment by 2030 to meet its renewable targets – a figure that underscores why individual long-term contracts, however significant, remain pieces of a much larger financing puzzle rather than evidence the puzzle is solved.
Renewable Energy Financing
Developing a renewable energy project in the Caribbean? AI Capital Exchange helps project developers, utilities, infrastructure sponsors and businesses pre-qualify for solar, wind, battery storage, waste-to-energy and other renewable energy financing opportunities through its global lender network. To explore financing options, visit AI Capital Exchange and get pre-qualified today.
RELATED: