16,000 Americans demand US-EXIM Bank withhold funding for Guyana’s Gas-to-Energy project

Jun 03, 2024 News

---

…say project a disaster for country

By Davina Bagot

Kaieteur News – More than 16,000 Americans have written to Chair of the United States Export-Import Bank (US-EXIM), Reta Jo Lewis demanding the financial institution not to fund the controversial Gas-to-Energy (GTE) project being pursued by the Government of Guyana (GoG).

Since April 2023, it was revealed that Guyana applied to the US EXIM Bank for a US$646M loan to support the Natural Gas Liquids (NGL) facility and the 300-megawatt gas-fired power plant- two components of the venture. To date, the application has not been approved. According to a letter from 16,452 members of Friends of the Earth United States, a non-governmental organization, the project is both a disaster for Guyana and the climate.

They said, “This project is both a disaster for Guyana and the climate! The U.S. government should not be using taxpayer dollars to subsidize Exxon – a company that has recently reported billions in profits.”

The advocacy group in the missive issued late last month went on to point out that studies done indicate that the gas project is not necessary as solar panels could provide a cheaper alternate of power generation. According to the letter, “This fossil fuel project in Guyana is not even close to necessary. Some analyses have shown that installing solar panels would meet the energy needs of Guyanese communities. Moreover, it would cost less to build, reduce bills for ratepayers, generate local jobs, and fight the climate crisis.”

The letter also pointed out that “This project will help increase the world’s dependence on fossil fuels and make limiting global warming to 1.5°C even more difficult.” and that “greedy companies [like] ExxonMobil will get even richer!”

The activist group noted that the letter was sent in solidarity with Guyanese citizens who are opposing the gas project on multiple grounds including the failure to carry out an environmental impact assessment for the gas plant; the lack of a business case; the lack of any financial information showing how spending billions of US dollars would deliver ‘cheap’ electricity; the failure to comply with national law and environmental risks involved with the project.

Meanwhile, 15,435 members of Friends of the Earth also sent a separate letter to US Vice President Kamala Harris urging her to vocally oppose EXIM support for gas in Guyana. The Vice President has yet to formally respond to voice opposition to the projects. Friends of the Earth US was founded in 1969 in San Francisco, and was one of the founding organizations of Friends of the Earth International in 1970. Friends of the Earth US has for decades been at the forefront of high-profile efforts to create a healthier and just world.

Over the last 40 years the organization has reformed the World Bank to address environmental and human rights concerns; stopped more than 150 destructive dams and water projects worldwide and pressed and won landmark regulations of strip mines and oil tankers.
Although the US EXIM Bank has not granted approval for the loan, the GoG has made it clear that the lack of financing from the institution will not stall the project.

Vice President Bharrat Jagdeo during a press conference in October last year said that the loan has not yet been approved, but government is confident that the green light will be given soon. To this end, he explained, “If there is need for, we can have bridge financing until that comes on stream and from what I gather, the loan can fund retroactive expenditure so if you have bridge financing then you can go back and clear it easily once the loan comes on stream.”

Jagdeo told reporters that President Irfaan Ali met with the President of the US-EXIM Bank during a visit to the United States and had “really good discussions”.

A damning international report by the Institute for Energy Economics and Financial Analysis (IEEFA), a US think tank has pointedly underscored that going solar is a less costly alternative to the gas project.

Kaieteur News reported that in the report, co-authored by Tom Sanzillo, Director of financial analysis for IEEFA and Cathy Kunkel, an Energy Consultant at IEEFA, it was explained that distributed (rooftop) solar power provides an alternative to the gas-to-energy project that can be built out in small increments to avoid overbuilding the generation system.

The experts stated that a rooftop solar and storage system consisting of 2.8 kilowatts (kW) of solar panels and 10 kWh of battery storage would be more than sufficient to meet this level of current and projected consumption, producing approximately 368 kWh per month.

“We estimate that such a system would cost approximately US$7,800,87 and would generate power at approximately 15 cents/kWh less than the cost of GPL’s current rates (20 cents/kWh for residential customers) or of a diesel generator,” the IEEFA experts said.

---

• Americans, bank, GTE, loan, US-EXIM

---