Dear Editor,
Former Prime Minister Samuel Hinds mentioned a “North American compensation package” for the CEO of GPL in his letter published in Stabroek News on August 27, 2015. In the same letter, Mr. Hinds mentioned that after the private “core investing partner” walked away from the GPL, the government called on two individuals heading electric utilities in small islands in the Caribbean to return to GPL with the government’s commitment to “fully compensate them, matching and even bettering whatever they were then receiving as foreign North American nationals.” What is confusing here is why a “North American compensation package” was offered to individuals working in the Caribbean? Furthermore, did the government fully investigate what compensation the individuals were giving up to return to Guyana? You just cannot rely on words of individuals.
Editor, I am an Engineer with the New York State Department of Public Service. As an employee there I am extremely familiar with electric utilities we regulate in New York State. Although I must state that I am not writing here on behalf of the Department, I can say unreservedly that if the annual compensation for the CEO of GPL mentioned by the Stabroek News as G$74 million is true, then this amount is absurd when compared to similar personnel in New York. Matter of fact, GPL cannot be compared even to the smallest regulated Investor Owned electric utility in New York which serves about 25 times more load than GPL. The largest electric utility in New York, Con Edison’s, peak load is about 13,000 MW compared to GPL 110 MW. Moreover, these utilities also serve gas, and in the case of Con Ed, steam customers.
The salary of the CEO of GPL can, if anything, be compared with the salary of some of the heads of small municipalities we regulate. These salaries are typically in the US$100K to $150K range. Of course the CEOs of these municipalities would most likely possess the technical and administrative capabilities to be hired by Investor Owned Utilities in the USA at lower level positions.
If a “North American” standard is use for compensation of the CEO of GPL then we must consider some of the standards use by North American utilities, failures of which could lead to heavy financial penalties. Most electric utilities in the USA plan their transmission system for something called an N-1-1 contingency. Simply put, in New York, a 1,000 MW nuclear plant can trip and after some system correction we can lose another major transmission line without any customer losing power. In Guyana, a small generator trip loses the entire Demerara-Berbice interconnection with major loss of power to customers. This tells me that GPL has major power system stability problems or bad relay settings or something of the sort. GPL should spend the money to model the system so that voltage, thermal and stability issues can be studied. Some other quick comparisons; in New York a customer can expect to lose power about 1.7 hours per year whereas in Guyana the number is about 180 hours per year according to GPL 2012 annual report. The price per kWh for residential customers in upstate New York is about US$0.16 per kWh whereas in Guyana it is US$0.28 per kWh. Losses for GPL compared to New York utilities is another matter that calls for a separate discussion. The bottom line is that the CEO of GPL cannot be paid by North American standards unless he can meet some of the standards outlined here, which is to provide safe and reliable electric service at just and reasonable rates.
Yours faithfully,
Vijay Puran, P.E.
