Government yesterday announced that it’s soon to be rolled out solar power plans will see a decrease of 15 percent in fossil fuel use in the first year of implementation and by the third year heavy fuel amounts will be slashed by half.
“The solar arrangement will see us doing a couple of things. In the first instance, in the first year, after we are able to sort out the finances and move the money around, we are going to see a 15% of displacement of our relying on fossil fuel,” Minister of State Joseph Harmon yesterday told a press conference.
‘Between the second and third year, the projection is to move to 50% displacement of us relying on fossil fuel; heavy fuel. So that is going to make a major change insofar as our finances is concerned, in terms of buying diesel and so on,” he added.
Government yesterday confirmed a report carried in the Stabroek News Wednesday edition, which stated that it has a planned solar power strategy which it will implement using funding earned from Norway in a 2009 deforestation agreement.
Sources told this newspaper that a large-scale solar farm to supply about 100MW to the national grid is in the works and will soon be unveiled, as government moves closer towards it 2025 green energy target and satisfying the requirements for access to a large tranche from the Kingdom of Norway.
Harmon said yesterday that although overall 100MW of power will be produced, it would not be supplied from one solar farm as plans were being looked at to have solar farms located near to substations, so as to feed into the national grid. Current diesel generation will be kept on standby as a backup to the solar system, the minister explained.
Under the 2009 deal, Norway agreed to pay up to US$250 million over five years for Guyana’s performance on limiting greenhouse gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators. Only a small amount of this money has been utilized and monies are still to be assigned based on performance.
The IDB is currently holding US$80m in funds from the 2009 Norway forest protection deal. The money was to be Guyana’s equity contribution in the 165 mw Amaila Falls Hydropower Project (AFHP) which the current APNU+AFC government has virtually abandoned.
Harmon yesterday said that while government continues to embrace hydropower, it does not intend to invest in the AFHP but will keep maintaining the Amaila Falls Access Road and will use it as an asset should a prospective investor approach them.
“We are still embracing hydroelectricity but they are small-size hydro and with respect to Amalia, the fact is a lot of money was spent and we still have a road which is an asset. So if any private company that has the capacity to come and do a hydro power, we have that as an asset; we have a road that is already built. A road that can be part of the negotiation.
He added, “But insofar as the primary project is concerned, we will not be proceeding as a government to fund an Amaila falls as it stands.”
Norway has insisted that the US$80m ($16b) could only be applied to a project verging on the scale of AFHP and clean energy-based.
Making clear Guyana lost out on access to a large sum of the money, for failing to honour the terms of the Norway agreement, Harmon stressed that the losses occurred before his government took office in 2015 although some of the monies were lost through “exchange rates and when they transfer into the US account.”
“We were also penalized along the way, and this was even before we came into office and penalties amounted to millions of dollars. So failure by the government at that time to satisfy the requirement under that agreement [was the cause],” he said.
However, he said that there were still substantial amounts to be collected, including the US$80M which is being held by the IDB.
“There was US$80M, that is earned, that had been placed with the IDB and that money seemed to have been tied to the Amaila Falls Hydro Project. There is an additional US$40M dollars which was also earned that was supposed to go to the trustee account for certain matters to be dealt with, for projects which I will have to outline at a later stage. There is an additional amount US$10.5M which is meant to be the final payment,” the Minister of State explained.
“So the good thing about this is that we have been given the green light, so that the US$80M can be utilized for solar energy,” he added.
The Minister of State said that tapping solar energy as a great part of Guyana’s energy mix using the Norway funds should serve to clarify for persons “wedded to this idea that it was Amalia falls or nothing”.
Harmon also confirmed that the Georgetown delegation which recently travelled to Norway for discussions on the US$80m and other matters also explained its plans for introducing natural gas in its energy mix, as part of meeting its 2025 clean and renewable energy target.
Government has argued that natural gas will be readily accessible when oil production offshore begins in 2020. Thus the David Granger-led government policy makers believe that natural gas use should be maximized, even as it works towards weaning itself off of non-renewables.
“You have also heard me made mention to clean and renewable energy. Clean refers to the natural gas and this was an acceptance by the Norwegian team that they were prepared that as a transitory arrangement. Whereby natural gas was a resource that belongs to Guyana that it was cheap and clean it was a sovereign decision to what is done. While it was felt that if you have natural gas then no Norwegian money, I believe we had a practical discussion which is why I felt very excited about these meetings”, Harmon added.
He said that in Norway there was “no wrangling and tangling” between Oslo and Georgetown on any issue as Guyana’s delegation laid clear what was their vision for going green and Norway got first-hand explanations and presentations in this vein.
“I believe that unity of purpose stood us very well. I believe it is a very positive day for Guyana and the benefits which would come from it some have been approved and just waiting for funding,” he said.
And asked how soon the funding will begin being released, Harmon said, “As it stands right now the minister of finance is currently out and as soon as he gets back we will start speaking to the IDB and to the WB (World Bank) with respect to these funds and how fast they can be released”. He pointed out that government already has the proposals for the expenditure of these funds.