Minister of Finance, Dr Ashni Singh says that should 26 megawatts of additional generating capacity not be installed in the Guyana Power and Light (GPL) network, there could be a resort to load shedding for 2013 since there would not be enough power to meet the peak demand.
He was writing to lead Opposition spokesperson on economic matters, Carl Greenidge seeking to justify and rationalise why it was that the Government was investing over $5 billion in new Wartsila generating capacity when there was no mention of this at the time the national budget was presented. Greenidge had objected to the lack of details that accompanied the financial papers and said that this was in contravention of the Fiscal Management and Accountability Act (FMAA).
The provision in the financial paper was eventually supported and the Government was cleared to make the expenditure to acquire three 8.7 megawatt Wartsila units. They will be installed by the second quarter of 2013 at Vreed-en-Hoop. This follows the acquisition of similar units in 2009 and in 2011 and which have been installed in Kingston. Following the installation of the new units at Kingston, the power company had said that those would have been the last units required prior to the coming on stream of the Amaila Falls Hydroelectric Project.
The letter to Greenidge which was circulated in the National Assembly offered explanations as to the expenditures contained in Financial Papers 1 and 2/2012.
In the letter, the Minister said that the 26 megawatts being acquired will allow frequency conversion at Kingston to be undertaken and the 11 megawatts at Garden of Eden, which has operated for 20 years, to be relegated to standby duty as opposed to current base load operation.
He said that apart from mechanical checks the other option is to relegate the units to standby duty after they would have exhausted their economic life.
The Minister said that the optimistic increase in peak demand is premised on the continued high uptake of new services which exceeded 9,000 in 2011. He said that this had typically been about 4,000 to 6,000 in the recent past. It is also based on the release of latent demand as a result of an improvement in the quality and reliability of power when the Chinese funded infrastructure development project is completed by September 2013.
He noted that GPL has already executed a contract for the frequency conversion of the 22 megawatt 50 hertz plant at Kingston. “The equipment for the conversion is expected to arrive in December this year and work is expected to last up to six months. During this period 11 megawatts of capacity would be unavailable as the conversion would be done in two phases,” the Minister said.
“With the frequency conversion making 11 megawatts unavailable and another 11 megawatts at the Garden of Eden achieving 20 years, overall reliable generating capacity in Demerara would reduce from 80 megawatts to 58 megawatts with peak forecast at 85 megawatts,” the Minister said.
The Minister said that while GPL knew that the two units at Garden of Eden were reaching the end of their usable life, and that the company had planned to complete its frequency conversion this year, it was not expected that the frequency conversion would have been delayed. He said that it was this combination of factors that led to the deficit of at least 22 megawatts, thus necessitating the purchase of the new generator to make up the shortfall.
“The delay in raising the US$7.15M for the frequency conversion has caused the project to be deferred to 2013,” he said.
