GPL to get US$180M emergency funding to upgrade “weak” Distribution & Transmission system – VP

Vice President Bharrat Jagdeo

The Guyana Government will be seeking massive supplementary funding to upgrade the Guyana Power and Light’s aged Distribution And Transmission Network – something which Vice President Bharrat Jagdeo has emphasised needed to be done in order to accommodate the increased generating capacity that will come.
GPL has approached Government with a proposal for ‘emergency priority funding’ to the tune of US$180 million to upgrade its distribution and transmission network.
Speaking at his weekly press conference on Thursday, VP Jagdeo noted that Government has already made it clear that it would fund these upgrades which would have to start immediately to accommodate additional power that would come into the system.
“There is… a component running between US$180 million to maybe US$250 million that would lead to critical upgrades in the Distribution and Transmission system to ensure that once we have more power, that we take this power to Berbice and everywhere else… and that the poor transmission system and the weak distribution system… wouldn’t affect us. So, then we [won’t] have more power but still have blackouts because of the weak transmission system,” he stated.

Guyana Power and Light Incorporated

Already, the State-run power company was allocated some $95.7 billion in the 2024 National Budget.
According to the Vice President, the supplementary funding for these upgrades could either come from the national purse or through a loan.
“We’ve indicated that we’ll have the funding ready even if it has to come from the budget… It could be that or we could get it financed from a loan… But even if we have it funded from a loan, you still have to get the expenditure cleared in Parliament,” he explained.
The Vice President went on to note that there were several sources that Government could turn to in order to secure a loan for these works. However, he hinted at a preference for going through a private institution rather than the multilateral agencies since the former tend to have more favourable conditions such as lower interest rates.
This upgrade to the distribution and transmission network is just one component of the planned efforts to enhance the capability and capacity of the State-run power company. As it is, GPL is now generating some 165 megawatts of power, but the current peak demand for electricity is 180 megawatts.
Given the ongoing heightened frequency of power outages, Jagdeo noted that the financial paper will be tabled in the National Assembly shortly, since the upgrades have to start “almost immediately”.
“It has to be done before the middle of the year. We have to get this done in time for the distribution of the power,” the VP stated.
The next sitting of the National Assembly is scheduled for next Thursday, May 9.
Only recently, GPL signed a two-year contract with Qatar-based Urbacon Concessions Investments (UCI) for a power ship to generate 36 megawatts (MWs) into the national grid.
The floating power plant arrived in Guyana’s waters on Wednesday and works are being carried out to set up the infrastructure to connect the vessel to GPL’s distribution system at Everton on the East Bank of Berbice, Region Six (East Berbice-Corentyne).
While GPL had said that the power ship would start operating on May 8, it was reported earlier this week that preparatory work at the Everton site was behind schedule.
GPL’s Berbice Zone Manager, Ravindra Jagnanand on Tuesday related that one of the biggest challenges was the clearing of vegetation. He, nevertheless, stated that works were progressing to facilitate the power ship.
“We have to build a network to connect the power barge to our network…we have to construct a new transmission line to connect, and for us to dispatch from the ship to our grid,” he explained.
According to Jagnanand, the intention is to tap into an existing transmission line which would enable GPL to access power at different load centres in Berbice and Demerara. The main objective is to minimise outages as a result of generation shortfall.
“What we are experiencing currently is a lot of load shedding, being done because there is a deficit between our generating capacity and our demand. So, having this boost in our generating capacity will significantly reduce forced outages, or what we call load shedding,” he noted.
“Our team is working assiduously to finish this project and to conclude the network construction and maintenance on the line as quickly as possible,” he added.
As part of the multimillion-dollar deal, GPL has already paid a US$1 million mobilisation fee for the power ship, which was previously used in Cuba.
The power company has to pay a fee of 6.62 US cents per kWh as a monthly charter fee for the vessel as well as a monthly operation and maintenance fee of 0.98 US cents per kilowatt-hour (kWh) based on electricity generated.
GPL is also required to provide Heavy Fuel Oil (HFO) for the operation of the generators onboard the vessel.
In addition to the 35MW from the power ship, the capacity of the national grid will be further bolstered when the 300-MW power plant – a major component of the Gas-to-Energy Project – comes onstream next year using natural gas from offshore oil production activities in the Stabroek Block. (G8)