While total primary energy, shown in table above, has remained fairly constant or fallen in the last part of the 1990s, net electricity consumption has shown a steady increase. Consumption fell from 13.2 billion kilowatts (kw) in 1990 to 9 billion kw in 1993. But in recent years, electricity consumption has increased to 13.4 billion kw in 1999. Consumption in 1999, although roughly equal to that of 1990, does not reflect a return to the pattern of usage that prevailed in the period before the collapse of the Soviet Union. Electricity blackouts and shortages of fuel for transport services continue from the “special period,” albeit at a reduced level of severity. Instead, at least some of the increase in electricity consumption in the latter part on the 1990s is probably due to the rapid growth in tourism and tourists’ demand for air conditioned rooms and restaurants and possibly better outdoor lighting as well.

Forecasts of Energy Demand

In generating some estimates of future energy demand in Cuba, we use a number of different approaches. First, we assume that per capita energy demand will follow the pattern of the Medlock/ Soligo model. Second, we assume that demand will grow at the same rate as per capita income. This is equivalent to assuming a demand elasticity of unity. Finally, we assume that the per capita energy demand in Cuba in 2015 will become similar to that of other “comparable” countries in the region in 1998.

As Table 1 showed, Cuban GDP growth has recently averaged about 4 per cent per annum. If per capita income were to grow at this rate, per capita income will increase from year 2000 levels by 48% by 2010 and 80% by 2015. By 2015, Cuban per capita income in US PPP dollars would be slightly below the 1999 level for Jamaica.

Clearly, the future growth rate for Cuba will depend on a number of factors including future US policy towards the island. Removal of sanctions will increase the rate of growth, more so if the Cuban government encourages trade and investment with the US. Growth prospects are higher if sanctions are removed and foreign relations are normalized within the context of the current political regime so that property claims and other contentious issues can be dealt with in a stable and orderly manner. A chaotic transition accompanied by civil strife and a struggle to assert old property claims could seriously set back growth and development.

The following table shows projections for total energy use, electric generating capacity and gasoline demand for Cuba in 2015 under various estimating methods. The first assumption is that that Cuban per capita energy consumption will increase according to the pattern estimated by Medlock/Soligo. Second, the assumption is that per capita energy demand as well as per capita electric generating capacity and gasoline consumption will grow by the same 4% growth as per capita GDP. The remaining scenarios assume that by 2015, Cuba’s per capita energy use will be the same as each of the other countries in the comparison. That is, we present scenarios assuming that the pattern and level of energy use in Cuba, circa 2015, will look very much like that of Dominican Republic, Costa Rica and Jamaica in 1998. In the “Like Jamaica” scenario, we apply the Jamaican per capita energy use, electric generating capacity and gasoline use as given in Table X above to Cuba. A similar procedure is followed for the other “country” scenarios. The Dominican Republic has a population comparable to Cuba’s and an important tourist industry. Jamaica is a smaller country but represents a country with a highly developed tourist industry that could typify a future Cuba. Costa Rica is also small but represents a country that, albeit on a smaller scale, shares Cuba’s focus on human development with high literacy rates and universal health provision. Its tourist industry is smaller that that of Jamaica and features eco-tourism where per diem expenditures of tourists are lower than the resort oriented tourism of Jamaica.

For all of these scenarios, it is assumed that the Cuban population will increase by a total of 8% between 1998 and 2015, roughly the same rate of growth (about .5% per annum) as experienced in the 1990s. Calculations in the Table below assume that Cuba’s population will be roughly 12 million by 2015.

Projections for Cuba (2015)
	Total Energy Use:			Total Electric Capacity			Total Gasoline
	Thousands b/d oil equiv.			in thousands Megawatts			Consumption in b/d
	1998	2015	Change	1998	2015	Change	1998	2015	Change
Medlock/ Soligo	179	363	184	4.33
Growth at 4%	179	349	170	4.33	9.11	4.78	9.32	19.61	10.29
Like Jamaica	179	327	148	4.33	5.40	1.07	9.32	46.90	37.58
Like Costa Rica	179	206	27	4.33	4.81	0.48	9.32	39.43	30.11
Like Dominican Rep	179	132	-47	4.33	3.40	-0.93	9.32	21.61	12.29

Projections based on the Medlock/Soligo model yield the highest estimates for 2015 at 363 thousand barrels a day of oil equivalent, an increase in consumption over 1998 levels of 184 thousands of b/d of oil equivalent. As noted earlier, the income elasticity of energy demand is typically greater than one at low per capita income levels and this is the case for Cuba under this scenario.

The 4%/annum growth scenario (which assumes an elasticity equal to one) produces a slightly smaller increase in demand than the Medlock/Soligo model. However, this scenario produces a much greater increase in total energy consumption and electric generating capacity than the other “country specific” scenarios. The relatively modest increase predicted under these last scenarios reflects the fact that per capita energy and electricity consumption in Cuba already compares favorably with the other countries in the comparison. Hence, if consumption and generating capacity grow at 4% per annum, they will be significantly above the per capita levels prevailing in the comparison countries in 1998.

On the other hand, the predicted growth in gasoline consumption is much lower under the 4%/annum scenario than in the “country specific” scenarios. This reflects the current very low per capita gasoline consumption in Cuba. Even at a 4% per annum growth rate, Cuban per capita consumption of gasoline in 2015 would be below the 1998 levels prevailing in the comparison countries. Note that the negative number for electric generating capacity under the Dominican Republic scenario reflects the fact that electricity generating capacity in that country is below the current Cuban level. The Dominican Republic has been experiencing severe electricity shortages indicating that per capita capacity is currently below demand. Current construction projects are designed to raise capacity in the Dominica Republic and eliminate the severe shortages in electricity.