Pres. Ali now dissatisfied with GPL’s performance

Apr 03, 2024 News

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– says Govt. seeking financing from UK to fund transmission

Kaieteur News – After months of incessant blackouts, President Irfaan Ali has finally admitted that he is dissatisfied with the performance of the Guyana Power and Light, but again sought to lay some of the blame on the previous APNU+AFC Coalition Government that had managed to cut blackout and improved the financial health of the power company.

In a terse statement on his Facebook page following the meeting with GPL’s board and top management, President Ali said his meeting involved the Board of Directors and management of Guyana Power and Light Incorporated, the Power Producers and Distributors Incorporated (PPDI) and Wartsila at State House. “During the meeting, the President expressed his dissatisfaction with the entity’s performance while acknowledging the myriad of problems inherited as a result of a lack of maintenance and investments during the period 2015 to 2020. The exponential growth in demand, aged assets, and lack of redundancy in transmission were also discussed. The President has scheduled a follow-up meeting later in the day. It’s important to note that the Government has already engaged UK Export Finance (UKEF) to explore financing options for the transmission. Additionally, the President asked the utility to consider alternative options to provide bridging energy to meet the demand while waiting for the completion of the gas-fired power plant. The utility expects a further growth in demand this year of around 30MW,” the statement ended.

However, in a swift response to the President, former Public Infrastructure Minister in the coalition government David Patterson said the head of state’s comments that: “We inherited a system that was in total collapse. We are rebuilding that system” is untruthful.  Patterson recalled that the management of GPL – in 2015, the former PPP administration had lost confidence in the then CEO Bharat Dindyal, refusing to renew his contract. In a report prepared by GPL’s board, dated December 22, 2014, Patterson said his performance was listed as “below expectations”. According to Patterson on assuming office, the Coalition administration’s appointed board of GPL launched an international recruitment exercise, spearheaded by the internationally renowned firm of Price Waterhouse Coopers Advisory Services Ltd, who after extensive interviews, recommended the appointment of Albert Gordon – a CARICOM national with extensive experience in the power utility sector.

“On assumption of duties, Mr. Gordon commenced reorganizing and revitalizing the then ailing company. On their return to office in 2020, the PPP dismissed Mr. Gordon with immediate effect, and returned the previous “below expectations” CEO, talking about doing the same things, yet expecting different results.”

Patterson recalled that the GPL’s board report on the performance of the pervious CEO stated that “GPL has over the last few years written off over 10 generator sets which were destroyed due to poor operation, catastrophic failure due to the lack of proper maintenance, and fire.” “That was the status of the GPL generating capacity in 2015. During the next four years, GPL under the coalition administration procured 63MW of brand-new generating sets, increasing the generating capacity of the company by 50%, a never-before-seen expansion in generating capacity in such a short period – with no oil revenue. Contrast that to the PPP’s four years, the company has procured 17 third hand containerized sets of unknown quality and procurement methodology.”  Patterson said five months after this purchase, only four sets are operational, it is understood the remaining sets have several defects, which has rendered them ineffective – a prime example of poor technical management.

On the issue of transmission, Patterson said the above-mentioned GPL’s board report stated that there was “low utilization of planned budget; poor planning” thus resulting in frequent blackouts due to the lack of maintenance to the company’s Transmission & Distribution infrastructure. He said during the Coalition’s tenure, 300km of high voltage transmission lines were repaired or upgraded, 16km of new feeder cables were installed, the express feeders on the Demerara Berbice Interconnected System (DBIS) were completely upgraded, a new submarine cable linking Vreed-en-Hoop and Princess Street was installed, 486km of new secondary distribution lines were installed, 19km of secondary distribution lines were upgraded, 87,717 service lines were replaced, 502 new transformers were installed and 2,292 defective transformers were replaced – four years on, with five times the annual budget, the PPP’s GPL has not achieve a quarter of these milestones.

Patterson reminded that in 2018, via the then Ministry of Finance, Guyana gained access to a US$900M line of credit from the Islamic Development Bank (IsDB). The first request to utilise these funds was a loan of US$110M for GPL to construct new substations, a new additional transmission and distribution network, as well as upgrading the existing power infrastructure.” As expected, on assuming office, the PPP canceled the loan application without reason. Without a doubt, if this application was allowed to progress to implementation, several of the challenges now facing GPL would have been eliminated – another example of the Government throwing away the baby with the bath water in the name of politics.”

Patterson said the status of our power sector remains a matter of national concern. “I would readily admit that by June 2020, there were several outstanding challenges still to be resolved, however the company was heading in the right direction with a very limited budget. With Guyana’s increased resources and the importance of this sector to our national development, one would have expected some increased momentum in fixing GPLs problems – in contrast, significant progress has all been reversed in recent years. Instead of seeking to address these challenges, the PPP administration tries to hide their mismanagement of the sector. They have sought to place all their eggs in a single basket, the elusive Wales Gas to Shore project, which on its current trajectory is likely to become another project falling significantly short of promises and expectations. No amount of plasters, fluff, bluff, fancy speeches and high-priced PR, will move GPL forward, it is clear that the Government is sailing up a creek without a paddle. Solving Guyana’s problems requires all citizens, creating a meritocracy and facilitating a real democracy.”

New generators not working

Only last week this newspaper reported that nine out of the seventeen generators recently acquired by the GPL are currently on the grid. This was disclosed by Minister within the Ministry of Public Works, Deodat Indar. Even with these added sources of electricity frequent blackouts and power outages continue to plague this oil-rich nation. The minister was asked to provide an update on the new generators that GPL recently acquired and if they were already added to the grid. “Not all of them, not all of them on the grid, actually nine of them on the grid, all are on the planks let me clear it… All of them are on the planks, because I want to make sure you get my information correct. So all are set up and are on the planks (but), nine of them are on the grid, five of them should be added again to the grid some time during the new week,” he said.

“There were some electrical works that have to be done and the exhaust and everything have been installed. The fuel tanks and so just some electrical works need to be done to have five more. And then we have three more that will complete the 17 should be done before the end of April. That is the latest update as of Tuesday afternoon at four,” the minister added.

He was also asked about the frequent blackout being experienced across the country. Indar said that, “Yes that is the case, I asked GPL to put out a statement, there were three last week that is why I asked you when. Early last week, it would have been because we had two engines at the Power Producers Distribution Inc, (PPDI) two engines totalling 13 megawatts were down. Both engines experienced failures, one with a bearing and one with another issue and those were out of PPDI.”

The GPL Inc. in 2023 recorded a total of 96 countrywide power outages, signaling an increase from the previous year. This revelation came during a hearing of the Public Utilities Commission (PUC) last week when the power company came up for review of its 2023 Operating Standards and Performance Targets (OSPT). In 2022, there was a 10% reduction recorded in the outages’ frequency. GPL’s Divisional Director for Loss Reduction, Parsram Persaud explained that the interruptions were due to a number of reasons ranging from planned maintenance to emergencies.  Persaud disclosed that the prolonged dry season contributed significantly to the demand for energy in November and December 2023, hence, demand outstripped supply in several instances. He said the company was able to grow its generation capacity by 14.5 percent in 2023 but the peak demand for power increased by 21.4 percent. As such, Persaud said that the agency’s Smart Grid pilot project at Good Hope, East Coast Demerara (ECD) was yielding results that may see an increase in power for households and commercial entities.

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