"They knew all along and we knew all along that if they could not get permission in time to build a co-generation plant by 2003, they would have to build a slow-speed generator to produce electricity by 2003. They have agreed and we have agreed that we would look again at building a co-generation plant by 2005," he told the Daily Nation. "The point is that we could not build a new sugar factory before 2005. So strictly speaking, it does not make much difference to the sugar industry one way or another."

A co-generation plant is designed to burn bagasse during the sugar crop for about four months per year, and coal for the remaining eight months, he said.

"Because of the Kyoto agreement, Barbados does not want to burn coal. It is all tied up in that and the problem is that coal is economic to burn but diesel and other fuels are not, and therefore it would not pay them to build a co-generation plant [without burning coal]," Cave added.

Coal is an environmental no-no because it increases the quantity of carbon emissions at a time when world governments have committed to reducing its emissions under the 1997 Kyoto Protocol. The protocol commits developed countries to cut emissions to 5.2 per cent of their 1990 levels by 2012. Developing countries, like Barbados, are not required to reduce emissions, but increasing them would go against the spirit of the environmental pact.

Cave thinks there may be a compromise by growing elephant grass, which can be burnt for another three months of the year, leaving five months for use of an alternate fuel.

"Now, if you burn coal for only five months a year and agree that within ten years you would phase coal right out and replace it with something else, then it may be acceptable to burn coal," he said.

Building a stand-alone sugar factory would cost the Government $208 million compared to $166.7 million with a co-generation plant, since Light & Power would be responsible for the plant's cost, according to the final report of the Task Force On Sugar.