The Bar­ba­dos-based Caribbean De­vel­op­ment Bank (CDB) Mon­day said it has tak­en a sig­nif­i­cant step to­wards ad­vanc­ing ge­ot­her­mal en­er­gy de­vel­op­ment in the re­gion.

The CDB said that it has signed £10 mil­lion (One GBP =US$1.29 cents) Mem­o­ran­dum of Un­der­stand­ing (MoU) with the Unit­ed King­dom’s For­eign, Com­mon­wealth & De­vel­op­ment Of­fice (FC­DO), and the Grena­da gov­ern­ment to sup­port that coun­try’s ge­ot­her­mal test drilling.

The re­gion’s pre­mier fi­nan­cial in­sti­tu­tion said that the sign­ing of this agree­ment rep­re­sents a sig­nif­i­cant mile­stone in the Caribbean’s tran­si­tion to a clean­er, more sus­tain­able en­er­gy fu­ture, po­si­tion­ing Grena­da and the wider re­gion as lead­ers in re­new­able en­er­gy in­no­va­tion.

Prime Min­is­ter Dick­on Mitchell said that the mul­ti-mil­lion dol­lar in­vest­ment from the Unit­ed King­dom gov­ern­ment is a sig­nif­i­cant mile­stone in Grena­da’s pur­suit of a sus­tain­able and re­silient en­er­gy fu­ture.

“By har­ness­ing our ge­ot­her­mal po­ten­tial, we are tak­ing a bold step to­wards re­duc­ing fos­sil fu­el de­pen­dence, en­hanc­ing en­er­gy se­cu­ri­ty, and cre­at­ing eco­nom­ic op­por­tu­ni­ties for our peo­ple. This part­ner­ship reaf­firms our un­wa­ver­ing com­mit­ment to a clean­er, more sus­tain­able fu­ture,” he added.

CDB’s Vice-Pres­i­dent of Op­er­a­tions, Isaac Solomon, said the agree­ment re­flects the strong col­lab­o­ra­tions dri­ving the Caribbean’s sus­tain­able en­er­gy tran­si­tion.

“CDB wel­comes the con­tin­ued sup­port of its de­vel­op­ment part­ner, FC­DO, and looks for­ward to util­is­ing these funds as part of the Bank’s GeoSmart Ini­tia­tive to en­hance Grena­da’s Ge­ot­her­mal Drilling Project.

“With Grena­da’s com­mit­ment to ad­vanc­ing its ge­ot­her­mal de­vel­op­ment, this fund­ing will help un­lock sus­tain­able, in­dige­nous en­er­gy sources, strength­en­ing en­er­gy se­cu­ri­ty and re­silience,” he added.

In 2023, CDB ap­proved US$9.4 mil­lion for the Ge­ot­her­mal Drilling Project – Grena­da, which in­cludes drilling two ex­plorato­ry wells to as­sess the is­land’s ge­ot­her­mal po­ten­tial.

In ear­ly 2024, FC­DO pledged an ad­di­tion­al £10 mil­lion to ex­pand the drilling pro­gramme, en­abling deep­er and broad­er drilling at the same site to im­prove the chances of ac­cess­ing a com­mer­cial­ly vi­able ge­ot­her­mal re­source.

Ge­ot­her­mal en­er­gy, gen­er­at­ed from heat be­neath the Earth’s sur­face, pro­vides a sta­ble, 24-hour re­new­able en­er­gy source, un­like so­lar and wind pow­er, which are vari­able. Sur­face stud­ies sug­gest that Grena­da’s ge­ot­her­mal re­sources could sup­port a 15-megawatt pow­er plant.

This in­dica­tive po­ten­tial must be con­firmed through test drilling, cur­rent­ly un­der­way, fol­lowed by pro­duc­tion drilling. If suc­cess­ful, the project could re­duce the coun­try’s re­liance on diesel by up to 55 per cent. Grena­da’s pri­ma­ry ge­ot­her­mal prospects are lo­cat­ed near Mount Saint Cather­ine, the is­land’s high­est point.

The CDB said that through its Geo Smart Ini­tia­tive, it mo­bilis­es re­sources through strate­gic part­ner­ships, and pro­vides fi­nanc­ing and tech­ni­cal as­sis­tance to un­lock ge­ot­her­mal po­ten­tial, strength­en en­er­gy se­cu­ri­ty, and en­hance re­gion­al cli­mate re­silience.

The CDB said that be­yond Grena­da, oth­er is­lands in the East­ern Caribbean are al­so ben­e­fit­ing from fund­ing un­der GeoSmart.

In 2024, CDB ap­proved a US$34.8 mil­lion loan to fund the con­struc­tion of a 10-megawatt ge­ot­her­mal pow­er plant in Do­mini­ca, while fund­ing of US$17 mil­lion has been ap­proved for St. Kitts-Nevis to­wards the drilling of pro­duc­tion wells on the is­land of Nevis. CDB pre­vi­ous­ly pro­vid­ed US$27 mil­lion to sup­port the now com­plet­ed ge­ot­her­mal ex­plo­ration in St. Vin­cent and the Grenadines.