If LEC owns the power plants in the area who is retailing the power to the residents ? Is GPL buying bulk power and retailing it to Lindeners and at the rate being charged are they able to maitain the infrastructure and if not is Govt prepared to subsidize retail sale and if they do the rest of the country would be pissed off.

LEC does NOT own any "power plants" in the area. It is a distributor and bill collector.

BOSAI's power plant generates the electricity consumed by the people of Linden.

Unfortunately, don't know much details...just trying to bring some facts and objectivityto the discussion...

As we have told you many times.  GPL is not supplying Linden.  It appears that BOSAI can supplies Linden with its surplus electricity and therefore LInden benefits from lower costs.

If true a progressive govt wouid market this as a competitive advantage for Linden and seek to promote moderately energy intensive enterprises there.

But the PPP wants revenge against Linden for not voting for them.  Their actions blew up in their face and they have now created a mess that they have no idea how to resolve.

The Linden electricity rate increase issue

Historically, the bauxite industry in Linden had to produce excess electricity in order to facilitate the periodic peak operation of the famous walking draglines.  The excess was then fed into the community and for many years too, also into the national grid supporting the rest of the country.

 

When the bauxite industry was allowed to decline by both the PNC and PPP, the power plant went with it.  Since 1992, the PPP Government invested more than G$48 billion in GPL that was targeted at most of Guyana except for Linden, where instead they opted for privatisation.  As a result, the power plant was run down further, including a turbine exploding.  The Government eventually obtained a settlement, but none of this money ever made it back into the plant.

In 2006, the plant was given to the Chinese company, BOSAI, as a write-off.  Since then, the people of Linden have been at their mercy, because the PPP gave BOSAI the power to do whatever it wants.  First, they allowed BOSAI to set electricity prices outside of the Public Utilities Commission (PUC) which is totally wrong, because the PUC is the national electricity regulator.  This cannot be allowed to continue, and electricity pricing in Linden must be placed within the remit of the PUC forthwith.

Second, BOSAI took advantage of the freedom from regulation and charged an exorbitant rate for surplus electricity.  To correct this situation, the Government agreed to a subsidy, but given their record on corruption, it is not inconceivable there is some impropriety here. 

This practice by BOSAI must stop.  They must say what they charge and the basis on which they have arrived at that charge.  Since the electricity is produced principally for BOSAI’s own use, the applicable pricing policy should be marginal pricing, meaning only for the cost of producing additional power, and not total cost pricing.  In order to prevent a heavy rate increase in electricity, the Government must renegotiate with BOSAI along these lines.  BOSAI must also be held to its commitment to install heavy fuel generators which will further lower costs. BOSAI also buys fuel duty-free, and given GPL’s massive losses of 32%, their cost of production has to be lower.  GPL produces at a cost of G$30 per kWH, while BOSAI charges Linden almost double that! Linden is not connected to the national grid either.  So it makes no sense to compare Linden’s rate with GPL.

In all of this, the fact must not escape that under the PPP, Linden has become an even more depressed town, with unemployment estimated at over 70%.  Moreover, despite a loss in jobs in the bauxite industry, from several thousand to only a few hundred today, with very little alternative job opportunities being created, Linden still suffers from severe dust pollution from the industry. Nowhere else in Guyana is there pollution of that magnitude, and it is international norm that there be some amelioration by the offending industry.  This must also be included in the renegotiations with BOSAI.It is obvious that the PPP is more interested in BOSAI that the people of Linden.

Development in Linden by the PPP, particularly under the Jagdeo administration, has been severely wanting.  Major contracts are issued to contractors friendly to the PPP, who are not from Linden, and who hire very little of the local labour force and procure very little in the town.  As such, the residents from Linden receive little benefits from the huge profits made by these outside contractors, whose work is often of the poorest quality. Had Lindeners been meaningfully involved in these works over the last two decades, Linden today would have had major contractors hiring more Lindeners, leading to economic growth and development in the town.

Further, Government initiatives such as the Linden Economic Advancement Programme (LEAP) only produced minor results.  For example, LEAP was intended as an incubator for small businesses such as computer assembly, but that never took off, because the Government chose to import computers from its favoured “barber shop dealers” for schools and Government agencies in the region.  So when the PPP boasts of how much they have spent in Linden, while true, it has resulted in little actual development.  Moreover, the PPP has denied Linden access to more than one TV station.

The PPP suddenly increasing the rate of electricity clearly resulted from their massive defeat in Region 10 (Linden) in the last elections. It was political retribution against Lindeners. We must be clear in saying that nothing about rate increases in electricity for Lindeners was mentioned by the PPP prior to the election.  The PPP ought to know that it was the same bauxite workers who had joined with the sugar workers and stood up against Forbes Burnham.

Predictably, the PPP put a racial spin on the issue, saying the opposition wants to remove the subsidy from the Guyana Sugar Corporation (GuySuCo) which employs mostly Indo-Guyanese, while demanding the subsidy remain for Linden, a primarily African-Guyanese community.  This of course, is a heinous lie as the AFC only called for the corrupt and inept management of GuySuCo to be changed.  The AFC voted for and fully supports the G$4 billion subsidy offered to GuySuCo to preserve the jobs of the working class in the sugar belt.

The reference to the higher rate of electricity outside of Linden has racial overtones as well.  The PPP has been blatantly spreading lies and hatred by telling Indo-Guyanese that their resources are being used to subsidise electricity for African-Guyanese who live in Linden. However, the fact is that the rest of Guyana, including African-Guyanese enclaves such as Hopetown, Buxton and Dem Amstel, is subsidising Linden, just like all of Guyana, including Linden, is subsidising GuySuCo and its failed US$200 million white elephant Skeldon Sugar Factory. Conveniently too, they leave out the fact that the high rate is because of GPL’s extraordinary losses and line transmitting inefficiencies which are costing the taxpayers in excess of $5 billion annually.

So the fact is not that Lindeners are paying too little, but that the rest of the country is paying too much for electricity, because business friends and relatives of the PPP cabal are exempted from paying electricity.

The AFC will not support the increased rates in electricity at Linden until the PPP regime provides jobs for its people and the region becomes developed. In our Action Plan, the AFC had plans to make Linden into one of the new Economic Frontier towns, and we urge the PPP to put these ideas into action by aggressively pursuing the following:
•    Foreign investment from a reputable company to develop an alumina plant;
•    Develop the 200,000 hectares of the intermediate savannahs for citrus, legumes, vegetables, cattle,  etc. As the country’s second frontier for agricultural developments;
•    Intensify block-making capability using lateritic bauxite soil to support the housing industry;
•    Promote furniture manufacturing and value added wood products;
•    Establish a University of Guyana campus in Linden, offering courses relevant to the developmental needs of Regions 7, 8, 9, and 10.
Finally, we urge the PPP immediately desist from engaging in divisive politics, including playing the race card, and get down to the business of governing our country, for all of our people, under this new dispensation.

Why is the GoG referring to the increased "subsidy" due to the increase in oil prices.  The Govt made it clear that when the last agreement was extended oil was 30 DPB, today it's over 100 DPB.  If BOSAI is gleefully absorbing this hit, then good for them, the GoG has no issue.  But all the instigators know that's not the case, BOSAI's supply of cheap electricity is a contract with the GoG where the GoG mitigates costs which is burdened to the rest of the nation.  Stop acting like spoiled kindergarten brats.

This Guy GR is a SHAMELESS POLITICAL PROSTITUTE!!!!

Baseman, The Snakeoil Salesman dont understand the concept of Subsidy. I know he is always trying to sell Snakeoil to the Uneducated, this is how they get RICH and POWERFUL!!!

BOSAI's total production of electricity is being subsidised, including what it itself consumes.  According to BOSAI it consumes approx. 33% of what it produces, meaning somewhere between G$825 and G$1B of the subsidy goes directly to BOSAI.  You speak of this contract as if it was some a benevolent act by the Gov't, when the primary beneficiary is BOSAI.  But I suppose better the chinese than our own black people, right?

GPL produces at a cost of approx. G$30 per kWH and resells for under G$60, while BOSAI resells for over G$65.  Of that, approx. G$59 is paid for by the subsidy, and the rest by Linden.  And so when you remove the subsidy, it will be Linden that will be subsidising BOSAI.  

And the question of course begs, how is it that while GPL experiences losses to the tune of 32% (official figure), BOSAI sells for a price even higher than GPL?!

baseman, I suggest you inform yourself on the BOSAI deal.  That is of course, assuming you want to, and are not intent on sticking to your own made up narrative.

This is what I mention in another thread.  A subsidy to inject viability, increase the attractiveness of the venture with the aim of providing employment is perfectly in order.  By doing the, the Govt is, in effect, subsidizing the employees of BOSAI.  However, the Govt is correct in NOT including general consumption in this subsidy as it is clearly discriminatory against the rest of the people of Guyana who pay their fair share.  Most of the people on Linden don't work for BOSAI, so they are like all other Guyanese.

Once again, you have demonstrated the absolutely erroneous and weak position of the AFC on this matter.  No wonder the PNC left you to do the dirty work, they understand the issue.  The more you talk, the more i'm convinced the GoG is on the right side on the issue.

All the other stuff you wrote is nothing but cheap political pandering lacking in any firm grounding of reasonableness.

BOSAI got the business for free. So what is the subsidy for? Absolutely nothing. It looks more like a means to funnel money out of the country into the pockets of some corrupt PPP insiders.

Conjecture.  Why don't you go and see if you get some nah?

The "subsidy" is usually tax/duty concession of intermediate input costs.  Power is considered as an intermediate input in the production process as such alleviating the tax burden is normal.  Many countries do give special rates for electricity when it forms a significant part of the value-add.  The end product and employment will ensure higher value accrues to the nation.

Oh baseman, baseman, baseman...

BOSAI is a brown investor as opposed to a green investor, meaning they have come in to simply take over the existing assets rather than make significant fresh investments.  BOSAI in 2006 had promised major job creation for Linden, to build an alumina smelter, to install new engine heads on the generators to use cheaper, heavier fuel and to install pollution control systems on the kilns.

Today, some five and a half years later, BOSAI employs less than 500 people, the smelter is off the table, the generators still run on diesel (costing 20% more) and a dust filter has been installed on only one kiln.  Suddenly now, in the midst of the protests, you hear of BOSAI's plans to create 2,000 jobs.  And this is what you defend???

Moreover, while you continue to argue the community is owed nothing by BOSAI, please take note that as a major corporate resident of Linden, Bosai is obligated to pay property taxes for its mines and plants that lie within the town of Linden, but this has been waived by your goodly central Gov't. In North America, companies are valued by local Gov'ts for the dollars they contribute to the property tax base of the town.  At the moment, it is not clear whether the value of these outstanding property taxes (both owed and waived over the years) offset the value of electric subsidies to BOSAI. So, here we have a situation where Govt claims it is subsidising electricity, but the Town of Linden is also subsidising Bosai.

Factor into this the continued pollution as well.  Linden has a thriving pharmaceutical retail sector - the most common medicines are those for treating eye and respiratory ailments.  But then again, we are talking about black people here, right?

No, I don't think we are. We're talking about a convenient controversy to which the AFC may hitch its donkey cart. What a stroke of luck! By the way, has there been any news about who paid the fellow that $200,000?

It is said he named names...so let's hope he isn't "persauded" to change his story...

 Gerhard ,

If  what  you have  explained  here  is factual  based,  then this  contract  with  BOSAI is a crooked  one  that  goes  against   National interest and  more  specifically,  that  of the  people  of Linden.

"...GPL produces at a cost of approx. G$30 per kWH and resells for under G$60..

... BOSAI also buys fuel duty-free, and given GPL’s massive losses of 32%, their cost of production has to be lower... "

What is  missing  here is  what  is  the  actual KWH  per  hour  of  BOSAI's  production  cost . I  suspect  BOSAI  have  good  reasons  not to  divulge  this  information   since  they are  benefiting  from  the  Govt.  subsidy.  

You being your usual deceitful self. You should enlighten the posters here who 'said' he named names.........given that i know that this specific type of propaganda emanated from the opposition camp.

Then you're already peddling the notion that he may be persuaded to change his story this is just in case those names are of persons within your ranks.

Indeed that is what is missing here, Uncle Mara.  This is why we are asking BOSAI to explain their costs and the Gov't to come clean on the deal with BOSAI.  The sheet I saw from BOSAI showing the subsidy and consumption only lists the cost of fuel as the cost of production.  So clearly, that cannot be right.  Moreover, I was reliably informed that BOSAI buys the fuel duty-free and then resells internally, at a profit, to the power plant.

The protest getting out of hand only benefits the PPP.  Even a school child knows that.  Moreover, the Reichstag fire set by Hitler's agents is taught in Freedom House as an example of a building burnt and the opposition blamed.

So now we are getting further clarification.  The GoG subsidizes a major international corporation, but now wants Lindeners to subsidize them.  Even though that corporation not only employs but a mere fraction of those who once worked in bauxite, but refuses to utilize modern technology to reduce the air pollution which is damaging the health of many Lindeners.

Does it benefit the PPP in the long run? They might think so but I am not sure.  If Guyana once again collapses into a protacted period of instability and the PPP once again shows itself as being incompetent in hndling our ethnically fractured politics how will this benefit them?

Guyana risks falling into a position where all THREE parties are deemed irrelevant and people will do what they wish, including the criminal elements.  What is indeed obvious is that all THREE parties tried to use this problem for their own purposes and have now lost control of the situation, because none of the three care the slightest for the people of Region 10.

So are you saying that you encouraged the Lindeners to protest and continue to protest without thinking that it would get out of hand thereby benefiting ONLY the PPP?

The PPP benefit because it validates the deaths of those people. It misinforms the world that these are extremists, a word lodged centrally in the PPP talking points and repeated ad infinitum by its lackeys, gophers and pawns as well as by themselves. On that account the the deaths can be understood  and framed by that context.

Gmoney and his cabal must stop spreading lies. Bosai does not produce excess power to the extent that it can supply 70,000 people. Back in the Burnham years when they produced alumina which requires large amounts of electricity, indeed there was excess electricity produce. But then alumina production was ceased and they only need to produce enough to for their offices and personnel, hardly enough excess is produced to supply 70,000 people extra. Lies lies lies by the flower garden man now with blood on his hands for inciting the Lindeners causing the death of 3 person. Shame shame shame. 

 There are not 70000 people in linden and the electricity goes to households numbering some less than 20, 000.

BOSAI is more an electric company than a bauxite company. The tax breaks the government gives it plus import concessions make it a government subsidized and indirectly a people subsidized industry.  They do not get the taxes they ought to receive to assist them in their community.

Why the government  did it is a question  you have to ask Jagdeo and Ramotar since the details of how it passed to OMAI ( on whose board Ramorat sat)  and then to BOSAI ( from Iamgold) is still a mystery. 

Our imperial PPP never gives up the information as to how they spend our money or how they sell our assets. However, the monies that were involved, 5 million to OMAI to 46 million to BOSAI ought to give you some prickly feeling that there is indeed graft in the deal.

No you clown, duty and tax concession in the interest of making an investment more attractive and viable, which then employs lots of people and turns-out a higher value product in the end, is a standard model.  The Linden operation was left in decay by the PNC and as such is not as competitive as so the GoG has to make it attractive.  China has options for Alu as there is adequate global supply.

Lindeners are not being asked to subsidize anyone, those who work in BOSAI are benefiting from the tax/duty breaks.  This should only be extended to the bauxite mining operations.  The fact that a smaller operations cannot employ all is old news.

There has been a gold boom, timber, etc.  Many lindeners do possess the skills for these industries.  Infact many Lindeners are involved in these operations but hiding behind the smaller bauxite ops as an excuse to ride the backs of the rest of the nation trying to justify electricity subsidy.  Furthermore, the cheap electricity should have spawned small business development in that area absorbing many of the displaces.  The Sugar industry has also scaled down and the people found alternate livelihood without preferential treatment.

Excellent point.

 Bosai is not an electric company, the only reason they produce excess electricity for 70k people is because of the agreement with govt that was grandfathered in from the PNC era. Like any business they can not continue to give handouts. In fact you will note that Guyana had a hard time getting a mining company back into Linden for years as it was running at a loss. Bosai was the only show in town. I don't know of any subsidies or tax breaks to Bosai, this may be a figment of your imagination, but regardless this is no excuse to subsidize one community and have St Ignatious pay full rate. You and your spin doctors can spin all you may but the basic concept of right and wrong is for all to see, Linden should pay the full rate like the rest of Guyana.

20k household easily reconcile to 70k heads.  The supply extends beyond Linden itself.

Apparently the govt is subsidizing BOSAI.  If you have no problem with this then you ought not to be othered by the fact that this allows BOSAI, not only to get cheap electricity for itself but also for the rest of Linden.

Good point, caribj.

The population of the entire Region 10 is 42,000.  The amount of consumers that BOSAI supplies in Linden is 9,000.

aND WHAT IS YOUR POINT evil doer?? god WILL DEAL WITH PEOPLE LIKE YOU, mOSES AND rUMJHAAAAAATAN!!!

GPL's customer base is some 150,000, and a G$6B subsidy was paid this year to help cover for the 32% losses it experiences.  Most of these losses are because of theft by the big ones associated with the PPP.  But persons here are blinded to that, and are obsessed with the black people in Linden.

Here is a breakdown of the losses (http://gplinc.com/files/GPL_Fi...orts_May-18-2012.pdf):

Components (of the 31.6% losses):

(a)Technical: Line, transformer etc – 14.8% as at 31.12.11
(b) Commercial: - Old & Defective meters
- Theft: Direct connections;
- Meter tampering and by-passes
- Billing Errors
- 16.8% as at 31st Dec 2011
Total Losses: 31.6% as at 31.12.2011

Listen to this SHAMELESS LARWA!!!

"Most of these losses are because of theft by the big ones associated with the PPP."  But persons . Can you believe this IDIOT!!!!

Nehru, again I say, you're such a sweetheart.

Actually is lie Iman lie, you is the idiot here. Everybody here knows it already so shut yo rass nuh man.

Like yuh want meh give yuh the Sachin treatment and call you kakahole Putty

Bhai, I know you are not looking for gains or fame so I ask you, what do you think of GR rediculous statements???

Thank you Bhai, I know you care.