Topics

Mitwah

HYDRO ‘GONE A FALLS’…NOW LET’S MOVE ON!

August 25, 2013 | By KNews | Filed Under AFC Column, Features / Columnists

By Khemraj Ramjattan
AFC Leader

The role of reliable and competitive electricity rates in the economic development of any country cannot be overstated. Given our abundant natural resources, reliable and cheap power will be a catalyst for rapid economic growth.
Over the years many investments, local and foreign, have been deterred by the high cost of power in Guyana. This challenge has never been lost to the political directorates past and present. However, the many initiatives and proposals sent in to the political directorates have not been given any serious consideration as they ought to.
With its current high cost of power, Guyana needs to explore all sources of power, fossil-based as well as renewable such as hydro, wind and solar, all of which have attractive possibilities.
Any hydropower facility would bring tremendous benefit to Guyanese. This country pays the highest rates for electricity; and, for the most unreliable supply. Though myself and the AFC are getting a good pounding from certain quarters, I maintain that the Amaila Falls project may have been a good for Guyana. And this notwithstanding its current configuration may not have immediately resulted in lower electricity rates. No doubt it needed reworking and this reworking would have come after the IDB due diligence.
I was aware of its imperfections, namely, the high cost of borrowing, the high political risk premium, foreign exchange risk (the loan is denominated in Chinese currency which is currently overvalued, any depreciation in relation to the US dollars will hike the cost of the project), inadequate hydrology data, and so on. These are serious questions which I felt would have been answered by the experts from the IDB. But now that all of that is history, these questions should be taken back to the drawing board.
Further, an independent feasibility needs to be carried out by a competent and reputable firm, followed by an open international tender for a design, build and operate facility before any commitment of taxpayers’ resources is made. At every stage of this process a reputable firm of experts must be in charge.
It was a lack of transparency, and independent professional advice that resulted in what many social commentators called a sub-optimal deal.
Now that this hydro ‘gone a falls’, to use the local term, Government needs to define a clear energy policy directed through an Independent Authority free from political influences. Such policy should include sources of fuel other than diesel and heavy fuel. It must include Liquefied Natural Gas (LNG) and Compressed Natural Gas (CNG). Either of these could replace Diesel and Heavy fuel currently used by GPL, at significant reduction in fuel generation cost. I am advised that a cost of 11 cents per KWH could be achieved, which compares with the projected Amaila Falls rate under the now redundant Power Purchase Agreement with GPL.
This Energy Policy should include legislation that authorizes Private Power Companies (PPC) to stimulate private sector investments in independent power generation for supply to GPL. Again, political direction should be removed from the licencing of PPC. I am aware of too many credible investors interested in power generation being turned off by unscrupulous and corrupt demands from politicians in the present PPP leadership.
For more than 21 years the PPP Government has failed to provide reliable power supply while spending billions in taxpayers” money; and, should therefore stay out of generation.
GPL also needs to be more efficient in its operations or needs to be privatized. As has been demanded by so many, any restructuring of GPL must start with the removal of the entire Board of Directors and its replacement by a Board of competent professionals. The current Board has no regard for cost control and efficiency. The move to LNG or CNG should have been made a long time ago. This lack of entrepreneurial leadership and competence is what we will now pay for. It continues to spend scare resources on diesel and heavy fuel generation when all around us and the entire world is moving to LNG and renewables.
There is no Amaila Falls in Barbados or Jamaica, Antigua or even little St. Kitts and Nevis. Yet the cost of power there is lower and there are never any blackouts.
The present GPL believes that it will continue to pass its inefficiency and incompetence in the form of higher tariff to an already over-taxed populace.
The AFC rejects the continuation of this vulgar modus operandi of GPL and will hesitate to support calls for the further subsidisation of GPL, a further tax of the Guyanese consumer.
I believe that in our coastal and city areas, wind, solar and LNG should be pursued until we manage to get financing for a major hydro, like Amaila, in the near future. Private sector investment ought to be attracted here with suitable fiscal and other incentives.

Replies sorted oldest to newest

Former Member

Originally Posted by Cobra:

Ramjattan really takes pride in the Hydro Electricity failure. I have a good idea how they would have run the country had they been in power. They will get the hee-hoo in 2016. Let's move on to more failure by the AFC.

8/29/134:31 PM

MitwahSenior Member

In 2016, the people of Berbice will have the Skeldon Factory and the Berbice bridge as excellent reminders.

8/29/134:36 PM

MitwahSenior Member

Sithe is gone; it’s time to harness the country’s other resources

August 29, 2013 | By KNews | Filed Under Letters

Dear Editor,
We can expose the shenanigans and corrupt practices of the PPP administrators any day…that is easy for us to do. Rather than sit at their desks and do the people’s work, too many of them continue to make elementary governance mistakes because of their determined involvement in the secret lucrative deals to fill their own pockets – mistakes that have cost the taxpayers billions of dollars over the years.
But when the righteous people who practice politics of principle are not “hanging together” on basic things like calling on the minority President and his cabal to be more transparent and holding them accountable on projects like the Amaila Falls Hydro power, the white elephant Skeldon Sugar factory, the never ending ICT cable project from Brazil, and GPL for its massive power outages, to name a few – it is “cuff in the gut” for us the people who depend on the opposition to hold this runaway regime in check. This minority PPP government has refused to accept the new dispensation and is governing as though it has a majority.
The opposition forces have to stand together and make the valid point that Guyanese, by and large, are not against the Amaila Hydro Power, but they are against the secret financial arrangements; they are against a situation where only a handful of people in the PPP (Brassington and Brassington) are making decisions that will commit the nation to 20 years of cash payout of over G$420 billion with no consultation.
The people are against the secrecy behind the bills of quantities, the engineering drawings on this Project and the Contract. The minority PPP regime has told the opposition AFC/APNU that the above documents are confidential and cannot be given to them. Why is the PPP hiding these documents?
There must be a detailed national consultation of the exact retail price that electricity will be sold to the people of Whim and West Ruimveldt. The people want a detailed explanation and a public guarantee that after the completion of the project, the price will not change beyond the increase in salaries offered to public servants which is the usual 5 per cent.
Anything else will result in tough resistance by the opposition forces to the PPP action, like what occurred at Linden when the government decided to increase electricity rates as revenge for Lindeners not voting for the PPP in the 2011 elections. It was a rude awakening for the PPP… don’t mess with the people of Linden. The PPP regime and Sithe Global have refused to give such guarantees to the people.
If the minority president is serious about bringing hydro power to Guyana, he should first establish a managing committee with qualified personnel to oversee such a huge project. We say it is time to dump Brassington. He screwed up on the Marriott Hotel by allowing the contractor to not employ Guyanese workers; GPL, by not putting a policy in place to reduce line losses and prevent commercial theft; and last but not least, the imposition of the highest toll in the world on the Berbice Bridge.
We want a President who is willing to engage the people to discuss his vision for green energy and how he plans to go about realizing this dream – Sithe is gone; and he should stop crying and use the other energy sources the country has to move on to better things. Without a doubt, Hydro power is good for Guyana’s economy, but not by paying Sithe G$130 billion out of that G$420 billion for doing very little.
Time to move on; Guyana is a great country and when we work together we can conquer the highest mountain.
Dr. Asquith Rose and Harish S. Singh