energy poverty

The highest energy prices in the world

I recently wrote about Turkmenistan, which has the cheapest energy prices in the world – thanks to large gas reserves and a small population. And with those low prices, it has less renewable energy than anywhere else on the planet and is right at the back of the line on the energy transition.

But what about the opposite? Where are the highest energy prices in the world, and how is that affecting the transition to clean energy?

In a list of countries and their energy prices, there is a cluster near the top: island states. The Solomon Islands may have the most expensive energy in the world, at $0.99 a kilowatt hour. Vanuatu is second, with prices two thirds of that. All the rest of the top ten are island states, including Niue, Tonga and the Cook Islands.

There are fairly obvious reasons why energy is more expensive on small islands: imports are expensive. There are thousands of miles of ocean between some of these places and the nearest refinery or coal port. If you’re not on a trade route, there are no ships going your way and with small populations, there’s no economy of scale to be gained either. The more dependent a country is on energy imports, the more expensive it is going to be.

There are other costs too. Small islands are vulnerable to storms, which damages energy infrastructure. Repairs to the grid have to be paid for, and this pushes up prices. In many places there isn’t even a grid to speak of, or the demand for large scale generation. Instead, flexible or even off-grid fossil fuels provide the power. Electricity in St Lucia, for example, is 99% diesel powered.

Renewable energy is an obvious solution, but brings its own problems in small islands. Antiguan engineer Winston Whyte explains that “if you want to integrate renewable energy sources that are intermittent into a small grid like Antigua, there are particular challenges as opposed to integrating it into a big grid or what we call an infinite grid, like in the US or Europe.”

In Britain, we can balance Scottish wind power or Kentish solar across the whole country. We can export or import power with Belgium, France or the Netherlands, with an undersea connection to Norway also planned. None of this is possible with isolated islands. All intermittent energy has to be balanced where it is, dramatically limiting the number of strategies for doing it and tending towards the most expensive, such as batteries.

Nonetheless, many islands plan to move towards renewable energy. Antigua is prioritising schools and clinics, and helping to reduce costs for its most important services. St Vincent has rivers that support hydropower, which provides a more stable form of renewable energy – though there is seasonal variability to consider. Dominica has also been able to buck the trend with hydropower, which currently delivers 27% of electricity.

Geothermal is also a more consistent form of renewable energy. St Vincent has enough volcanic activity to have tested geothermal potential, in partnership with the experts in Iceland. It hasn’t worked out so far, but feasibility studies are ongoing in other places. St Kitts and Nevis announced a geothermal project earlier this year.

Solar and storage will become more common as battery technologies get cheaper. Wind power also has potential, especially if costs come down for floating wind turbines. Wave and tidal are not yet mature technologies, but there may be possibilities in future.

Energy for island states is quite a specific aspect of global climate change, but an important one. There’s a real justice issue here. Small island states are at the front line of the climate emergency, threatened by storms and rising seas, and yet unable to break free themselves from the fossil fuels that are driving the destruction. They should be a priority for climate finance from big emitters.

  • Feature image courtesy of Vinlec.


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