The Guyana Power and Light received an additional $4 billion in funding on Monday, when the National Assembly ventilated the supplementary budget.
Senior Minister with Responsibility for Finance, Dr Ashni Singh, reiterated to the House that when Government assumed office, a number of state agencies had been bankrupt. GPL had accumulated receivables, only from its Private Sector entities, in excess of $12 billion. A “tremendous” liquidity and cash flow crisis had then followed at the company.
He explained that this was a cascading problem, because a number of other agencies that owed amounts to the GPL were in turn facing similar states of financial distress. “We have been faced with the task of addressing this chronic problem, and we have set about doing so diligently,” Dr Singh relayed.
With this sum now allocated to the utility company, the Finance Minister said, a better cash flow would materialise.
“Of course, the challenges at GPL have been compounded by the fact that the fuel price on the global market has increased tremendously. We have, as a matter of policy, given a commitment that we will absorb this increase, and not pass it onto the consumer…
“This $4 billion represents a further effort to liquidate longstanding liabilities that are owed to GPL, and ease the cash flow challenges,” he explained.
Reports are that, at the end of 2019, the power company was owed $17.7 billion, of which $13.1 billion was racked up by the APNU/AFC Administration.
When the People’s Progressive Party/Civic (PPP/C) Administration took office in August 2022, GPL had just about $1.9 billion in its bank account, and that amount was sufficient to take care of the company’s expenditures only until October. At that time, the utility company was running at a loss of just about $8.7 billion.
It has been announced that planned infrastructural upgrades being undertaken at GPL in 2022 would see the company reducing its loss of generation capacity and improving its ability to transmit power to cater to demand. Those plans include reinforcing of the Demerara-Berbice Interconnected System (DBIS) through the upgrade of several integral transmission and distribution locations.
A $10 billion power plant located at the Guyana Power and Light’s (GPL’s) Garden of Eden Power Station was also introduced by Government. This state-of-the-art power plant, constructed by Wärtsilä, is operable by dual-fuel energy, meaning it can utilise heavy fuel oil and natural gas simultaneously. (G12)