Subsidising fuel prices for electricity cost Govt US$100M in 3 years – Min Indar

In order to curb the burden of increased power costs on the common man, the PPP/C Government has kept these prices constant despite climbing rates per barrel of oil.
Minister within the Public Works Ministry, Deodat Indar on Thursday disclosed that in three years, this subsidisation would have fetched a price tag of US$100 million.
When the PPP/C Government came into office in 2020, the price was about US$41 per barrel of oil. During the past three years, it has fluctuated around US$100 per barrel.
“It has been circling at a high level in terms of cost per barrel. Between US$41 to whatever the average price is over the last three years, GPL has subsidised over US$100 million. We have not raised the price on anyone. That US$100 million could have been used to buy all sorts of generating capacity and sacrifice to some extent, certain things that they wanted to do,” Indar told media operatives during a press conference.

Presently, the company has been grappling to meet increasing demands and households have been dealing with a spate of power outages in recent times. GPL is projecting that Guyanese will expect an ease to the current situation until mid-December when supplemental generation comes on stream.
Vice President Bharrat Jagdeo had explained that the increasing demand was due to large consumers flooding the grid. During the COVID-19 pandemic, the Government had moved the excise tax on fuel from 50 per cent down to zero per cent in a bid to combat increasing global prices for oil and the impact those increases were having on the local economy. As such, self-generation became more expensive, and many companies opted to use the GPL supply to capitalise on the subsidised costs.
GPL has about 224,000 customers in total with a current demand of 172 megawatts. With a capacity of about 167 megawatts, thousands of customers still face disruptions.
On Friday, the utility company publicly announced that it had reached a historic peak in electricity demand, recorded at an unprecedented 182 megawatts (MWs).
It reasoned that this situation is not unique to GPL, as countries around the Caribbean have recorded significant increases in demand due to rising temperatures in the Region.

GPL’s Development and Expansion Plan, 2023-2027 projected 186.6 MWs in 2023. Given this projection, the company began acquiring additional generation through public tenders early this year. This process resulted in the procurement of 28.9 MWs of generation as an interim solution in anticipation of the 300MW Natural Gas Power Plant at Wales, West Bank Demerara.
Currently, the daily peak demand has been surpassing our existing generation capabilities. In order to prevent total system shutdowns resulting from insufficient generation, the company has been temporarily de-energising some distribution feeders daily during peak demand periods to maintain grid stability.
Last month, GPL announced that large consumers of electricity, who each have a power-generating capacity, would be removed from the grid during peak hours in order to prevent widespread service disruption for the population.