President maintains need for other forms of energy
Amaila Falls report
Shutting down the most recent report coming out on the Amaila Falls Hydropower Project (AFHP), President David Granger on Thursday maintained that there was still need for the examination of other forms of sustainable energy.
The Head of State was speaking to Journalists on his weekly televised programme, “The Public Interest”. He said Government has examined the project from every point of view.
“We have asked for questions, but we also realised that since the project had been conceived, would other forms of generating sustainable energy instead of depending on one single project, we can have several projects because Guyana has other sites from which hydroelectricity could be generated,”
According to President Granger, rather than depending on Amaila, the administration can look at “a dozen sites”, since the project was “very expensive”.
The Head of State said he did not think that the expectation that the cost of electricity would be brought would even be fulfilled. According to him, other forms of energy are being examined.
“We are also looking at solar energy in places like the Rupununi and the Berbice Savannahs. These are huge grasslands with very high levels of sunlight. We are looking at wind along the coast and we feel that these other forms of energy should be put first and this is the advice we give to Norway that we not be pin down to a single project.”
The President said Norway was being asked to look at a menu of measures for generating green energy. He is positive that an agreement can be reached.
The independent assessment of the AFHP revealed that the only realistic path for Guyana moving towards an emission-free electricity sector was developing its hydropower potential and the fastest way forward was to maintain the AFHP.
The report, which was compiled by Norconsult, an engineering and design consultancy firm out of Norway contracted by the Government of Norway, detailed an “objective and facts-based” assessment of the Project on the agreement of the two Governments, and was released in late December.
According to the report, the first necessary step for revitalising the Project is a decision by the Government to maintain the AFHP as the priority project in the transition to a green generation regime, as recommended in the “Initial Study on System Expansion of the Generation & Transmission System” of 2014, and reiterated and embraced by Government in “Guyana’s Power Generation System Study” of June 2016.
Importantly, the independent assessment team noted that by restructuring the current financial model, the risk for Guyana’s economy can be reduced. “The annual payments from GPL may possibly be reduced by 20 per cent, which are significantly lower than the current fuel costs paid by GPL for its oil-fuelled generation. The risk to Guyana’s economic stability would be at the same level with other projects generating the same amount of energy, as the investment would be of a similar magnitude,” the team concluded.
In their opinion, the Engineering, Procurement, and Construction (EPC) tenders from 2008 are outdated and need to be replaced by a new EPC tender process, noting that before that, certain technical features of the Project should be reviewed and the EPC tender documents updated.
According to the report seen by Guyana Times, to get on with these activities, the GoG will need continued support by the Inter-American Development Bank (IDB), or a similar institution, and the Guyana Light and Power will need technical and management support by a highly-qualified engineering company with extensive experience in the international hydropower industry.
“We may suggest that the cost for buying out Sithe Global from the project company and expenses for services by an engineering company engaged for support until a new main sponsor is established are covered from a portion of the US$80 million deposit in IDB for later being turned into equity contribution from GoG to the project company,” the report noted.
In the report, it was estimated that three years would be required from a decision being taken to resume project preparation for the AFHP until Financial Close and Notice to Commence to the EPC Contractor. “From this point in time, we estimate another 3.5 years for construction until start of commercial operation of Amaila Falls Hydropower Project.”