Economic Consequences of Select Water-Energy Links : An Investigation of the Potential of Water-Energy Links Used to Improve the Economics and Added-Benefits of the Electrical System on Grand Cayman

Abstract: This investigation posits the hypotheses: 1) Renewable energy is a viable economic alternative to current electricity sources on Grand Cayman and 2) focus on the water-energy nexus reveals positive synergies in water and energy economics on Grand Cayman.             These were investigated by examining the water-energy links of wastewater as a resource, and water produced from a hydrogen fuel cell. Conditions were varied including cost and efficiency factors to understand the limits of both links.             The results show that both hypotheses can be confirmed, though not in all circumstances. Longer project lifetimes increase the viability of renewable energy. Short lifetimes favour fossil-fuelled energy. Generally, water-energy linked thinking is economically favourable when the water is considered an additional product. The economic benefit of the hydrogen fuel cell is near-negligible due to low water flow rate. The economic benefit of wastewater as a resource is large, offsetting much of the costs of any project, particularly at long lifetimes. Both links provide societal benefits in the form of increased water availability. This increase is small for the hydrogen fuel cell water link, and large for the wastewater link. The wastewater link is however limited both by availability of wastewater, and acceptance of the direct reuse of treated wastewater.             It was determined that further investigation of these and other links are justified. The economic value of water-energy links is proven over a wide range of variabilities. Renewable energy has also been shown to be economically viable for the island of Grand Cayman.