Govt mindful about being locked into long-term power purchase deals – VP Jagdeo

…says Guyana’s energy mix will triple power output, cut emissions by 70%

With the highly-anticipated gas-to-energy project (GtE) project expected to bring cheaper and more reliable power in the near future, the Guyana Government is being cautious about entering into any long-term purchase agreements to address the country’s current electricity woes.
This is according to Vice President Bharrat Jagdeo while addressing Heads and Officers in Charge of Guyana’s various diplomatic missions across the world, who were in Georgetown over the weekend.

On Saturday, there was a high-level engagement during which the diplomats were updated on the developments in the different sectors of the country.
In his presentation, VP Jagdeo pointed out that while these Missions are flooded with proposals from foreign companies to supply power in Guyana, especially given the current unstable power system, there is the nuisance of contracting a long-term arrangement that would leave the country stranded with expenses in the future.
“[We’re] very mindful of the need not to lock into long-term power purchase agreements that will harm us a year and a half from now where we’d have to pay all this [money]. So, just in case people come to you about these power purchase agreements etc, there is that. If they’re prepared to do that for a year and a half or two years, that’s fine [but] at a reasonable cost. We can entertain any proposal at that level but not beyond that period [that is] the completion of this power plant,” Jagdeo stated.
The People’s Progressive Party/Civic (PPP/C) Government has embarked on a host of endeavours to upgrade the country’s energy grid and its supply distribution. Chief among them is the gas-to-energy project in Wales, West Bank Demerara.
This initiative features a 300-megawatt (MW) combined cycle gas turbine power plant and an integrated Natural Gas Liquids (NGL) plant using natural gas that will be produced offshore Guyana and piped onshore.
With a timetable to deliver rich gas by the end of 2024 and the Natural Gas Liquids (NGL) plant to be online by 2025, works are progressing on getting the project off the ground.

The combined cycle power plant is expected to generate up to 300 megawatts of power, with a net 250 MW delivered into GPL’s grid on the East Bank of the Demerara River.
The US$900 million gas-to-energy project will have a 25-year lifespan and is expected to employ up to 800 workers during the peak construction stage, as well as some 40 full-time workers during the operations stage, and another 50 workers during the decommissioning stage.
In addition to this project, the Government is also undertaking a number of other projects to expand its energy mix as part of Guyana’s transition from fossil fuel.
The country’s energy mix will feature gas, solar, and hydropower.
Only recently, the Guyana Government issued a new Request for Proposal (RFP) for the languishing Amaila Falls Hydropower Project (AFHP).
A brainchild of the previous PPP/C Administration, the 165 MW AFHP has been on the cards since 2011. However, the A Partnership for National Unity (APNU) and the Alliance for Change (AFC) Opposition parties having majority seats in 2014, barred the project from becoming a reality.
The PPP/C outlined the resuscitation of the project in its 2020 manifesto. Fast forward to 2021, the Cabinet granted a no-objection for the Prime Minister’s Office to engage the China Railway Group Limited to construct the hydro project. However, discussions ended in a deadlock when the company wanted to change the Build-Own-Operate-Transfer (BOOT) model.
According to reports, the Chinese company was unable to secure the necessary financing for the BOOT option, thus the request to change the contract to an Engineering, Procurement, and Construction (EPC) model. But the Government insisted on keeping the BOOT model hence that deal fell through.
The new RFP that was issued just over a week ago, invites proposals based on a BOOT model, which includes the construction of a hydro dam, transmission lines from Amaila to Linden plus sub-stations at the Amalia site as well as upgrades and completion of roads and bridges to the site.
The deadline for submission of pre-qualifications is November 28, 2023.
Earlier this month, Jagdeo had reported that there have been mounting interests in the Amaila Falls project from firms in Brazil, Austria, and several from South Korea. There were also interests from the United States and Canada.
The Vice President said on Saturday that in the near future, Guyana will have a complex power mix and even with increased output, the country will still be able to significantly cut emissions with its diverse renewable energy options.
“So, we’re going to cut emissions by 70 percent and triple output of power which [will allow us to] move closer to our climate goals and at the same time, meeting an essential component for growth and comfort in a country, which is stable and cheap power,” Jagdeo stated.
As it is, Guyana Power Light Inc (GPL) is struggling to meet increasing demands for electricity, which has resulted in heightened distributions to the national grid.
In a series of “temporary measures” that are geared towards regulating the power supply during peak hours, the Government has asked large-power consumers to step off the national grid during peak hours, otherwise, they would have to pay increased rates.
Currently, peak demand has risen to 185 megawatts (MW) compared to just 110 MW in 2020 – an increase that is a result of massive economic growth in Guyana over the past few years under the Dr Irfaan Ali-led Administration.
As such, President Ali announced on September 30 that big power users are being encouraged to leave the grid and return to self-generation during the peak demand periods of 13:00h to 15:00h and 18:00h to 22:00h. But if these companies choose to stay on the grid during this period, then they will have to pay an additional cost of 10 cents per kilowatt hour.
“This is a temporary measure until we get this close to 30 megawatts of new power coming in at mid-December and then this temporary measure would be withdrawn so that everyone can come back on the grid [full time],” the Head of State assured.
In light of this announcement, GPL earlier this month started to knock off large electricity consumers, who have power-generating capacity, from the national grid from 18:00h to 22:00h in order to prevent widespread service disruption for the wider population.
Challenged with keeping up with the “unprecedented peak demand,” the power company said only a small percentage of large industrial customers with self-generating capacities responded positively when they were asked to produce their own power during peak demand hours.
“This is a temporary but necessary measure for the company, to prevent service disruptions,” GPL indicated in a notice. (G-8)