As the holiday season approaches, Karpowership of Turkey has secured the bid to provide an additional 60 MW of electricity to the Demerara-Berbice Interconnected System (DBIS). Vice President Bharrat Jagdeo confirmed yesterday.
Earlier this year, the company began supplying 36 MW from a ship moored at Everton on the Berbice River. That deal had been widely criticized as it was argued that better options were available including the purchase of brand new generators. This second deal will likely raise similar concerns.
Jagdeo yesterday noted at a press conference that the powership’s bid price started at $0.1117 per kilowatt-hour but was reduced to $0.095 per kilowatt-hour after negotiations.
“The cost of fuel is about 13 US cents per kilowatt-hour, which brings the overall cost to about 22-23 US cents per kilowatt-hour,” he added.
The contract to establish 5 kilometers of transmission lines has also been awarded, and while the materials required are still being sourced, the project is expected to be completed within six weeks.
“We are hopeful that the powership will be operational before Christmas,” Jagdeo stated. This move is expected to help alleviate the increasing power demand during peak periods in the Christmas season.
In the long-term, Jagdeo mentioned that the powership could have additional capacity, providing a total of 75 MW, which would allow for maintenance of older units currently running at full capacity while preparing for the upcoming Gas-to-Energy project, expected to further stabilize power supply in the coming years.
Other companies that bid for the 60 MW contract included power systems and heavy-duty machinery conglomerate, Machinery Corporation of Guyana Ltd (MACORP) which indicated that it could supply power at US$0.0645 per KWH.
Houston-headquartered natural gas company, Andalusian Energy LLC, which had submitted proposals to develop Guyana’s gas infrastructure was also among the bidders.
Florida-based JP Energy solutions which has on its website, a photo with one of its executives posing with Vice President Bharrat Jagdeo, also submitted a bid.
VAS Energy which says that it has been an energy broker since 2007 and has offices in New York and here in Guyana also submitted a bid.
Jagdeo stated that though the other companies had submitted bids they would’ve had to establish plants.
On May 1st this year the first powership arrived here to supply 36 MW. It encountered several teething problems.
The government on April 18th this year assured that consumers will pay no increase on their power utility bill, even as GPL announced that it was paying the powership rental company a US$1 million mobilisation fee in addition to around US7.06 cents per kWh (kilowatthour) in monthly charter, operation and maintenance fees.
GPL on April 18 announced the terms of the agreement it signed with “Urbacon Concessions Investments, W.L.L (UCI) to charter a powership with a total installed capacity of 36 Megawatts (MWs) for a period of two years.”
“The contract includes the provision of operation and maintenance services as part of the agreement…The contract requires GPL to pay UCI a fee of 6.62 US cents per kWh as a monthly charter fee for the powership and a monthly operation and maintenance fee of 0.98 US cents per kWh, based on electricity generated,” GPL said in a statement as it pointed to the US$1 million mobilisation fee.
It is unclear how the mobilisation fee is amortized over the two-year period, into the cost per kWh.
