GPL bound to fail in current format – source

Power outages

…Guyanese should expect more blackouts
…public utility upgrade significantly delayed

With the current spate of power outages, many are questioning the progress of the Power Utility Upgrade Programme (PUUP) that was initiated in 2014, costing US$64 million and intended to rehabilitate the Guyana Power and Light (GPL) systems.
However, power outages continue to disrupt the lives of many Guyanese.
In the meantime, the company has said it needs US$110 million to fix its problems. An upset director of the company who reached out to Guyana Times expressed

concern about the delays that have characterised the project and the additional sum being quoted.
According to the director, over $100 million on new generation, transmission and new sub stations was spent by the company, adding that “GPL was under an expansion plan”. He added that in 2014, the company secured the PUUP for US$65 million, some of which was European Union (EU) grant money, “part [Inter-American Development Bank] IDB loan, to do a couple of things, but primarily to rebuild the distribution network and to re-meter”.
“They would go into areas; (to work on) distribution lines and that would have helped to reduce losses. That project, I think, is significantly delayed. It’s 2018 and I think not very much has been accomplished. The project is non-performing,” the upset director said.
He added that GPL’s engines, operated by the Power Producers and Distributors Incorporated, are old; so old, in fact, that he expressed fear of an increase in power outages by next year owing to a drop in generation capacity from equipment failure. According to him, this would allow the entity to claim that the equipment was old, should it fail in the future, causing a failure in capacity.
He said that he became upset when the Government kicked out Wärtsilä.
“Wärtsilä had the oldest operating and maintenance contract with GPL in any other company in the world. Wärtsilä wants to make sure the equipment is always working. (And you) kick them out? I would not be surprised if next year one of the pieces of equipment fails and they say oh, this is old equipment. By next year I predict we’re going to get more blackouts because we don’t have enough generating capacity,” the frustrated director said.

US$110 million
When asked, the director also made specific reference to GPL’s new Chief Executive Officer (CEO), Albert Gordon’s statement in April that US$110 million was necessary to overhaul the company’s operations. The source observed that the sum sounded excessive.
“How much money they need sounds like a lot to me. Only a few years ago, fuel prices started to fall, GPL had significant cash reserves. I don’t know what has happened…who spends or transferred somewhere else,” he said, adding that as a director he has not been receiving forthcoming information.
“But I’d like to see our financials and compare it to a few years ago…because fuel prices dropped significantly, so we were picking up billions in savings every month. We didn’t reduce the tariffs.”
In 2014, the IDB had approved loans totalling US$37.6 million along with non-reimbursable investment financing from the EU to help boost the efficiency and reliability of Guyana’s power system.
The IDB had said the project would be done through electricity loss reduction measures, improvements in the operational capabilities, and strengthening the management and corporate performance of GPL.
The contract for the execution of the power upgrade programme was awarded to China National Machinery Import and Export Corporation/China Synergy Electric Engineering Company (CMC/CSEEC). The local subcontractor is Ramoutar and Sons Contracting.
But for some time now, GPL has been plagued with constant power outages and other systemic failures causing consumers to complain bitterly about the poor level of service being provided.
At a Public Utilities Commission (PUC) hearing earlier this year, GPL had said over the next three years, it would roll out about 80,000 smart meters, which would have radio transmitting capacity to send out data.
GPL Deputy CEO (Technical) Elwyn Marshall told the utility watchdog that the meters fell under the PUUP, which was aimed at providing a higher quality of service to consumers.
With the sustained and widespread complaints over the quality of service the power company provides in mind, commissioners had queried how the voltage regulation system would be monitored.
The Deputy CEO added that the smart meters would allow GPL to better monitor its feeder system, each of which was supposed to have only 4000 costumers.
Other measures GPL announced to improve its services included splitting existing feeders, rehabilitation of its distribution networks and additional power generation plants at Canefield, Anna Regina and Bartica.
Ultimately, however, GPL was fined five per cent of its shareholders’ dividends earlier this month by the PUC over the poor service.