I always maintained that the Amaila Project was useful to Guyana

Jan 05, 2017 Letters

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Dear Editor,
On December 28, the Ministry of the Presidency issued a statement asserting that it “proposes to utilize a mix of energy options, starting with less risky options such as solar and wind, as outlined in Budget 2017”. The reason gives for this position from the Granger administration was that The Report from the Norwegian Consultants “provides supporting evidence that the Amaila Falls Hydropower Project (AFHP) would not be optimal in its current model and presents an unbalanced risk to the Government and People of Guyana.” So was this the final conclusion from the Consultants?
After examining the Report I found on Page 37 the following statement attributed to these same consultants, “From a financial and economic point of view, development of Amaila Falls seems to be the optimal solution for meeting the electricity demand in Guyana. The project should be financially restructured in order to make it more attractive for GOG and potential investors.”
On that same page, we also find more telling advice from the Expert Energy Consultants, “The financing challenge as a result of the perceived risk of investing in Guyana would be the same for all projects of a similar size, and substituting AFHP with another hydropower project of a similar size would not make any difference.”
But to reemphasize why AFHP is the best option for Guyana green energy needs, the Consultants said on Page 35 of the Report that, “from a system point of view, solar power is not sufficiently stable and can therefore not be recommended as the main source of power in the main grid. Solar may be used in off-grid areas with battery back-up and or in the main grid for generation during day-time, but it cannot function as a source for base load power.”
After reading this Report, I personally feel vindicated because when I opposed this project, my reasons were arrived at purely on financial grounds, my forte and not on the engineering reasons which I am no expert. So I will leave the engineering side to the Charles Sohans of the world. I said then that US$858 million project was too expensive and that the cost of equity for the sponsor was too high and the distribution of the risks were misaligned. But the then PPP government would have none of it and pressed on with the flawed financial model to the nation’s detriment. The financial analysis that I personally constructed with some colleagues proved that the Jagdeo option was over priced (see -http://www.stabroeknews.com/2011/opinion/letters/12/16/there-should-be-%E2%80%98tripartite-leadership%E2%80%99-on-the-amaila-project/). However I have always maintained that AFHP was important to Guyana. Therefore, I am deeply saddened by the actions today of Minister Patterson since he is not driving an agenda that can mold this nation on the energy front. Guyana is about to lose even more now, because of the Granger cabinet.
The Norwegian suggesting some financial and engineering restructuring of the project, not abandonment as Minister Patterson is pushing. What is now absolutely clear is that Minister Patterson does not understand this project and it would be advisable to assemble a tripartite team of the Government/Opposition/Civil Society to advance the recommendations of these Experts.
What is clear is that Minister Patterson is not seeing that the “the annual payments from GPL may be reduced by 20% compared to the original proposal” as calculated by the consultants. But the bigger picture remains that having AFHP in place can significantly lower the current operating cost of GPL compared to this company using these gas guzzling generators. These savings can directly feed through to the ordinary people by reducing their light bills.
It is now a clearly established fact as documented by this report, that AFHP is the most feasible and bankable alternative green options to bring reliable and low-cost green energy to Guyana; not solar or any other forms of energy. While all sorts of green energy especially that from the Hope Beach Wind Farm must be welcomed and are necessary, none of them can provide 164 MW of energy for 10 months in every year for 100 years at US$0.11 per Kwh in a reliable and dependable manner.
I am shocked therefore by this position attributed as the recommendations of Minister Patterson to the cabinet that the AFHP presents an “unbalance risk to the people of Guyana”. I am convinced this position is patently erroneous and weak. I cannot stand by and allow people who clearly are putting the future of the children of Guyana at risk because of their petty vindictiveness, inability to think big and ignorance at molding such a big deal. Minister Patterson’s actions reveal that he clearly cannot feel the pulse of the nation. People are fed up with black out and even if we successfully implement all the solar energy initiatives in the 2017 Budget, it will only sort out the energy needs of Mabaruma, Bartica, Mahdia and Lethem and a few other hinterland areas. That is less than 2% of the population. Who in their right mind would develop an energy agenda to progress the energy needs of 2% of the people and leave 98% of the nation in abeyance?
Please permit me now to invite the Minister to examine more closely the accuracy of his positions and take the necessary actions to address the needs of the people and stop playing political games with such an important matter as the nation’s energy security.
Sasenarine Singh

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