Ocean Thermal Energy Corp.’s seawater A/C system at Baha Mar resort ‘on target’

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When the enormous Baha Mar resort opens in the Bahamas next month, its air conditioning will be provided by a chilled-water plant, not the innovative, energy-efficient deep-seawater cooling system being developed by Lancaster-based Ocean Thermal Energy Corp.

Nevertheless, deployment of the latter system remains the resort’s goal, and the work is advancing, according to resort and OTEC officials.

“We are still looking at deep water cooling as a form of cooling for our air conditioning system,” Baha Mar senior vice president Robert Sands told Bahamas TV news show NB12 on Wednesday, according to the Nassau Guardian newspaper.

“We are hopeful that we will commission such a system, not upon opening, but sometime in 2016.”

The project “is progressing and on schedule” to open as planned, OTEC chief sustainability officer Jim Greenberg told LNP in an update on the project earlier this month.

“Everything is on target,” he said.

The project includes 2,200 rooms spread across four luxury hotels, dozens of restaurants, bars clubs and retail outlets, condominiums, an 18-hole golf course, the region’s largest casino and 20 acres of beach.

The $3.5 billion cost was mostly financed by the Chinese government and built by thousands of imported Chinese laborers. According to the Wall Street Journal, it is China’s largest commercial real estate project on foreign soil.

Running conventional air conditioning for such a large operation is expensive. Hence the rationale for OTEC’s 9,800-ton seawater system.

Seawater air conditioning makes use of cold deep-ocean water as a refrigerant. It can cut energy costs by up to 90 percent compared with a conventional system, OTEC says.

The actual realized savings depend on the specifics of the project.

About 45 percent of a large hotel’s electricity goes to air conditioning, OTEC said.

Sands had previously confirmed to the Nassau Guardian in August that Baha Mar planned to “migrate” to the seawater system “once we get through the necessary government approval process.”

Sands did not respond to a request from LNP seeking additional comment.

OTEC described the Baha Mar project in a circular prepared last year for a stock offering.

Once the seawater system starts running, the chilled-water system will become a back-up, OTEC said.

OTEC estimates the project cost at about $130 million, 90 percent of which will be financed via a debt offering. OTEC has yet to close on its financing with Deutsche Bank, but that “is not far down the road,” Greenberg said.

OTEC’s circular said it had invested about $6 million so far. The company says it has signed a 20-year contract to operate its plant.

OTEC has preliminary agreements on several other projects, but Baha Mar’s is the farthest along, and would be its first completed commercial facility.

Baha Mar called a halto OTEC’s plans in the summer of 2012, citing delays in hitting planned deadlines, but the company and resort resumed talks about a year later.

Currently, construction for the land-based portion of the project is at the stage it needs to be and the timetable for the major work at sea is unaffected by prior delays, Greenberg said.

OTEC has 15 employees. Besides its South Queen Street headquarters, it lists addresses in Manassas, Virginia; Nassau and the Cayman Islands on its website.

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