Opposition strikes down key Hydro Bills

Jul 19, 2013 News

– Project greatly wounded – PM

In a severe blow to the US$840M Amaila Falls Hydro Project, the Opposition, last evening in a Parliamentary sitting punctuated by starts and stops, voted against two key Bills, threatening a month-end deadline set by one of the major financiers and essentially placing the project in limbo.
The development could very well push back the prospects of a hydro project of that magnitude by another five years, Government said. It was unclear what the next steps would be.

Prime Minister Samuel Hinds, Leader of the Opposition David Granger and Dr. Rupert Roopnaraine attempt to arrive at a consensus last evening.

According to PM Hinds, the hydro project has been greatly “wounded”.
Finance Minister Dr. Ashni Singh said that the Government will now move to reflect on the implications and remain engaged with partners.
The blocking of the Bills would effectively mean also that none of them could be tabled again in this session of the 10th Parliament.
Government officials said that in all likelihood, critical financing of US$175M from the Inter-American Development Bank (IDB) is dead, at least for this year.
In October, when the National Assembly resumes its sittings after the August recess, would be too late, Government says, as the IDB board is meeting then. All documentation has to be submitted before.
After indications from the Opposition that it would not back the Hydro Electric Power (Amendment) Bill 2013 that is designed to empower Government to approve a bio-diversity reserve area to cater for potential overspill from the facility, Speaker Raphael Trotman and members from both sides of the House scrambled for over two and half hours to arrive at a possible consensus, but in vain. The Opposition made it clear that it would not be debating the Bills but would remain silent.
Close attention is being paid (to the passage of the two Bills) by the Inter-American Development Bank (IDB) which has given Guyana until the end of this month to have the new laws in place. Officials of the IDB were observing the proceedings last evening. The bank has been approached to plug US$175M.

Drama
The vote came down 32-31 on the first Bill, but then there was drama again. Member of Parliament of A Partnership for National Unity (APNU), James Bond, was not in his seat when the vote was taken and it was pointed out by Government Chief Whip, Gail Teixeira. His vote was cancelled. However, the tied 31-31 vote still did not change the results.
The Speaker, during the prolonged break, on resumption of the sitting, said that meetings between the two opposition parties and the Government had failed to achieve an agreement. He also said the Opposition would not be participating in the debate of the Bills.
Urging the Opposition to support the Bill, Natural Resources Minister, Robert Persaud said that the economic, social and environmental survival of the nation hinges on the hydro project, as current power costs are way too high, making competing difficult.
“There are eyes looking and people will look at the National Assembly with disappointment unless the right things are done,” Persaud said.

APNU, AFC members and House Speaker Raphael Trotman in an emergency meeting.

He made it clear that his party, the ruling People’s Progressive Party/Civic, will continue to make the 165 megawatts, earmarked for the Kuribrong River, Region Eight, a reality…if not today or tomorrow, then sometime in the future.
The Bills are designed to ensure that Guyana complies with international requirements that there are environmental safeguards in place.
Public Works Minister, Robeson Benn, stressed that the hydro power, a cheap form of energy, is the missing aspect of the country’s development. “Our country will remain poor and backward if there is no cheap power soon,” he said.
Benn said that any stoppage of the project would send serious negative signals to investors in terms of future developments.
The Minister said that government was prepared to “beg” to get what is needed to be done in the national interest.
Benn, an outspoken official, also lashed out at the track record of the 10th Parliament, which he said has failed, with the right decisions not being made, and whatever decisions are made, they are done in petulance.

Five to 10 years
In appealing to the Opposition for its backing, Prime Minister Samuel Hinds, who also holds the portfolio for power, warned that if not passed, the Bills will push the hydro project back by another five or 10 years, as it would take that time to put it together again and attract investors.
And according to Housing Minister, Irfaan Ali, the hydro facility has the potential to save Guyana US$3.5B over a 20-year period, and the Opposition will have to take full blame for any negative fallout.
For poor residential customers, savings will accrue to $2.5B annually, Ali said.
Finance Minister, Dr. Ashni Singh, speaking on the “Guarantee of Loans (Public Corporations and Companies) Act”, made it clear that Blackstone Group, which is funding the project, and other similar companies will think twice with a vote against hurting the country’s potential to attract investors.
And Chief Whip Teixeira said the country’s image would be damaged and its “trustworthiness” irreparable in terms of future engagements with the investors. No hydro project will also damage the people of the country and have an impact on the political environment, she stressed.
Of the US$840M for the hydro facility, US$100M is coming from the Government in Guyana; US$175M from IDB; US$152M from Sithe Global while US$413M will be coming from China Development Bank.
Earlier this year, the Opposition blocked almost $20B in funding for the project, citing concerns over costs, among other things. The two Bills that have to be passed before July 30 are the “Guarantee of Loans (Public Corporations and Companies) Act and “Hydro-Electric Power (Amendment) Bill 2013”.
On the “Guarantee of Loans (Public Corporations and Companies) Act”, the Opposition used its majority to block it.