Developers endorse Amaila hydro project in face of media critics – call for consensus from legislators

Reputable partners are fully behind the Amaila Falls Hydropower Project (AFHP) and are calling for legislators to give unified consensus amidst a string of pressing questions from members of the private media and opposition allies that appeared to put the project and the Government efforts in disrepute.

Senior Managing Director, Blackstone Sean Klimczak and President Sithe Global Brian Kubeck accompanied Chairman of the Guyana Power and Light (GPL) Winston Brassington to another round of stakeholder discussion on the much talked about hydro project today at the Guyana International Conference Centre (GICC).

Senior Managing Director, Blackstone, Sean Klimczak speaking at a stakeholder consultation forum on the Amaila Falls Hydropower Project

Blackstone, the parent company for Sithe Global and a premier global investment and advisory firm with years of experience in energy related investments has made US$16M of capital investments in the Amaila hydro project through the management of Sithe Global. The other partners are China Rail Construction Company and the China Development Bank.

Amidst speculation about the project’s feasibility and benefits to Guyana, the developers are convinced that the hydro project is necessary particularly in a country where there is underlying growth and a good public- private partnership.

“We look for projects that are the least cost alternatives in the countries. There are three different studies that have been concluded all of which have pointed to the Amaila site and number two the Amaila Project,” Klimczak said in a power point presentation to the gathering of stakeholders.

After detailing the benefits of the project to the country’s domestic and commercial consumers in short and long- term financial savings, the developers stressed that the “time is now” for the project to come on stream and for the political row that is at present stalling progress to end.

President of Sithe Global Brian Kubeck speaking at a stakeholder consultation forum on the Amaila Falls Hydropower Project

“What we are asking for is a unified consensus view from Parliament on this project, that the country embraces this project… which the construction cost of which represents 25 percent of GDP of the country is not one that we, Blackstone or Sithe want to do without a coalition and a consensus agreement. This is a good thing for the country,” Klimczak assured.

On July 18, the joint parliamentary opposition voted down two important pieces of legislation that were prerequisites to the Inter American Development Bank (IDB) loan that is to be given consideration when the Bank’s Board of Directors meet in October this year.

The legislative action was met with heavy criticism from various stakeholders in society who have embraced the long awaited project and the benefits to be gained from a cheap and reliable supply of electricity.

Under the Build Operate Own and Transfer (BOOT) system, Guyana will have complete ownership of the project after a period of 20 years when all the dues are expected to be repaid. Works on the access road to the Amaila Falls project has reached 67 percent with a year-end deadline in target.

Brassington explained plans to connect Linden to the grid and ultimately eliminate the need for Government’s subsidy to the mining town and allow Lindeners to benefit from renewable energy as well.

As the journalists made repeated inquires about whether the burden of repaying for the project will be felt by the taxpayers, the developers were prompted to stress that the tariff is the main source of funding to repay the debt.

“There is no taxpayer involvement here so long as GPL collects money from its customers and pays the relevant amount to the Amaila Falls Hydropower Incorporated (AFHI).

AFHI according to Brassington is a private company with government holding majority share.

Contrary to the last stakeholders’ forum members of the media were allowed to field questions but the manner in which the questions were hurled, prompted moderator Kit Nascimento on several occasions to reprimand the journalists for their lack of decorum.

Brassington had to clear the air on the percentage tariff reduction saying that 40 percent that was initially mentioned related to cost and 20 percent, consumer tariff.

“What we can say with quite a degree of certainty is that we will have a substantial reduction in cost and we will have a reduction of the tariff,” Brassington assured.

The AFHP, a priority under the Low Carbon Development Strategy (LCDS) is Guyana’s the medium and long- term strategy for the electricity sector where cheap and reliable supply of energy will be sourced, for all consumers.