“While the window to prevent such an occurrence is small and closing fast, we call on all political parties to come together in the national interest to support a project that all parties have long agreed is necessary to boost Guyana’s competitiveness and improve the lives of its people with less expensive and more reliable energy,” Hardt said in an opinion piece to the media.
Despite repeated calls for discussions to allay concerns, the 26-seat A Partnership for National Unity (APNU) has refused to support the project because of concerns that it would hugely burden the country with additional debt and there was no guarantee that the cost of electricity will be reduced because of built-in costs and the inefficiency of Guyana Power and Light (GPL) which will buy the electricity from Amaila Falls Hydropower Inc (AFPHI). The seven-seat Alliance For Change (AFC) has conditionally supported the debt ceiling to GUY$50 billion until more technical information from the Inter American Development Bank (IDB) is provided.
APNU Chairman, David Granger could not be reached for comment and he was expected to return to Guyana on Tuesday.
Government has said that GPL would sell the power to consumers at 19 US cents per kilowatt hour in contrast to the 33 US cents being currently paid from fossil fuel generation.
Hardt noted that although all political parties had appeared to have implicitly supported the project for the past six years, in recent weeks it suddenly became enmeshed in political battles that had little to do with the potential of the project to generate cheaper, more reliable, and more environmentally friendly energy for decades to come.
The American envoy cautioned that if the US power generation firm, Sithe Global, walks away finally from its US$150 million investment in exchange for a 60 percent stake in AFHI, the country’s investment climate would be damaged and reviving interest in hydropower generation would be tough.
“Sadly, the country’s political parties have thus far been unable to come together to support a project that offers all citizens — of all parties — the prospect of lower electricity rates and more reliable energy. The demise of this project is likely to diminish Guyana’s future attractiveness to international investors, and make future investments in the energy sector riskier and more costly,” he said.
The US Ambassador pointed out that political consensus was key to assure Sithe Global that if the administration changes at any future elections that the deal would not be changed or renegotiated.
“To mitigate potential political concerns for a project that represented 25 percent of Guyana’s GDP — the biggest single investment in Guyana’s history — the investors determined that they would require a unified commitment from all of Guyana’s political parties. Such a commitment was necessary to ensure that the investment required would not become subject to a loss of support in the event of shifting political configurations,” he said.
The US envoy explained that one of the most critical elements for investors is political stability and reliability over the term of an investment. He said investors needed to know that a project, once launched, would enjoy continuing support regardless of potential political shifts. “Such political stability and reliability requires political leadership that is willing to pursue policies that will advance long-term national interests, create new opportunities for people, and improve the standard of living for all,” he said.
Meanwhile, the Private Sector Commission (PSC) on Monday urged the APNU Chairman and his team to meet with a government delegation to thrash out the two key concerns about the AFH project that he has identified. The Commission called on the opposition to take up the President’s offer and let the talks continue in good faith in the national interest. “We believe that the only fair and reasonable way to address these concerns is for APNU to engage the President’s offer. We wish, therefore, to encourage Mr. Granger to accept the offer,” the business organisation said in a statement.
The PSC reasoned that APNU should take up the offer for in light of its long-held view that government has failed to provide the opposition with all of the information needed to arrive at an informed decision while at the same time criticizing the project. “What better way, therefore, to resolve APNU’s concern than a meeting with the Government’s negotiating team, with nothing withheld and everything on the table,” said the PSC.
The PSC accused “self-styled pundits” of harming the hydropower project by peddling in the media of uninformed opinions and basing their analyses on incomplete or outdated information. “We feel that this project is too vital to the future of our nation to allow such spurious analyses to determine its fate.”