Dear Editor,
In response to the letter in Stabroek News of February 13, (‘The PM should say which bargain and policy he is referring to’) Prime Minister should like an opportunity to answer the questions put:
1. Concerning repairs to Moco-Moco, there were three possible solutions considered after the landslide (i) just restore the piping (penstocks) G$60-70 million; (ii) add some degree of ground engineering which would reduce the likelihood of another landslide to some extent but would increase the cost to G$100 to G$200 million; (iii) a total rebuild including relocation estimated at G$500 to 700 million. None of these was attractive.
2. We pursued electricity supply from Bonfim across the border. We were told that we would need to provide for a transmission line from a substation near Boa Vista – think of something in the order of G$500 million. At the time, some used diesel engines were being released at a number of small local generating stations on the Brazil side, for which we could make offers. More recently, it was made known that a three way Guyana-Brazil-Venezuela agreement would be required and currently power is said to be in short supply.
3. We pursued agreement with INCOMEX for the re-development of Moco-Moco. The price offer per kWh supplied was attractive. At a personal level I would have grabbed it and I have no doubt that Mr W Brassington would have too, but we needed the basis of their pricing to be very explicit and detailed to meet the expectations of transparency and accountability expected of us. It took a while to get to an agreement with the explicit details required, which we were ready to enter into, but by then INCOMEX had grown tired and moved on to other projects.
4. The government policy is to provide “a degree of electrification” to every household across Guyana. It takes account of location – opportunities at that location ‒ density of houses, income levels, etc. Individual households and communities are free and encouraged to do more for themselves according to their circumstances, and everyone has the right to self generate. In practice, the policy is:
i) Government would put in capital costs (the capital cost per household being reasonable).
ii) Consumers/beneficiaries are expected to carry all operational costs including maintenance.
This policy is realised at this time in:
a) providing distributed households in the hinterland, 65 watts PV SHS systems, about 9 kWh of electricity per month; a one-off grant of about $80,000 to $100,000 now.
b) for large and dense enough cores of communities, an initial power plant ‒ diesel or hydro or whatever is available which would do the job; a pricing structure of the first 15 kWh/month at no charge, every other kWh at full operational costs with a cap at a hundred dollars.
c) Government financed extensions of the GPL network from time to time, with a cap of $100,000 to $200,000 max per household benefited.
This policy in practice is not, ‘a one size fits all’; it provides flexibility in making use of local opportunities.
5. For persons not in a regular cash economy the 15 kWh at no charge guarantees lights for the children’s homework and a small radio. As and when money is available some of that money could be identified and put aside for electricity at full cost, which at this time is capped at G$100 per kWh but which according to the opportunities at the location could be less.
6. Customers in Lethem over the last three years have been receiving an average operational subsidy of G$100,000 or more each year, which, with the present tariff structure is a grant of, from about $25,000 to $1,000,000 per year, from customer to customer; not sustainable; not fair across Lethem and connected neighbouring communities; not fair across Region 9; not fair across Guyana.
7. Lethem truly has been without electricity for some days but two new generators are on their way from Port Georgetown. The Prime Minister is willing to take some blame for the people of Lethem (and elsewhere) not receiving the electricity service that they expect, to the extent that PM has not been insisting that the policy be kept – a lifeline of the first 15 kWh at no charge and full operational costs (capped at $100) for every kWh more. If PM had been insisting so, LMPCI (and other companies) would be sufficiently resourced, to deliver what is intended and expected of them. It is a lesson the PM should always keep before him.
Yours faithfully,
Samuel A Hinds
Prime Minister
