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sam hinds

Letter: Cheddi Jagan and the PPP/C Steadily and Greatly Improved our Nation’s Electricity Supply

I write this letter responding to the editorial entitled “GPL” in the Sunday Stabroek of November 12th. It seems to me that the Editor set out not wanting to appear to be on either side, neither the PPP/C nor the PNC/APNU&AFC Coalition, thus he used a broad brush which obscured significant details with the risk that we would miss some important lessons, much of which we have paid for and continue to pay for in adverse experiences and in much frustrations.

In the editorial, there is a reference to 1978, no doubt recalling that nearly three-day period when Georgetown and its environs were without electricity and water – perhaps the lowest point in our supply of electricity. There was not much recovery fourteen years later when Dr. Cheddi Jagan and the PPP/C entered Office in October 1992. I could not concur more with the Editor when he says, ”Then came President Cheddi Jagan who in the early days of his period of office which happened to coincide with a particularly bleak period of electricity crisis”, accurate to this point but demonstrably inaccurate in the latter part of this sentence, “seemed to be absorbing himself with promulgating the New Global Human Order, rather than fixing GEC (Guyana Electricity Corporation), as it then was.”.

The last part of that sentence could not be more wrong: our electricity utility was extremely close to Cheddi’s heart and he spoke many times of how during his 1957 to 1964 period as Chief Minister/Premier his Government accepted the offer to purchase the then Demerara Electricity Company as the shareholders decided to get out of that business. Cheddi couldn’t help repeating time and again how well the utility was run then with the person he selected, a tailor, as Chairman. By all accounts the electricity supply was satisfying unto our days of strife and strikes and turmoil (1962 to 64) which eventually pushed Cheddi from Office.

Cheddi returned to Office (in 1992) with tremendous zeal to return GEC to creditable performance. As would have been known at the time, Cheddi and our new PPP/C Government were under great pressure from the MFIs (Multilateral Financial Institutions) and Bilateral Relationships to immediately and totally privatize the provision of electricity in Guyana. Cheddi led the arguments that immediate privatization to foreign buyer(s) would be precipitate and premature – there was much for us, the populace, to learn and much for us to correct and change before seeking a privatization that would not be a give-away but a reasonable business transaction. Cheddi called for a degree of initial improvements by our own means before going to privatization. Guyana was not agreeing to the privatization of our electricity utility as a total basket case.

Cheddi was continually involved, unlike the Editor – some may say too much, as it took Cheddi’s understanding and personal standing to lead our country in many new directions including restoring our electricity utility. It required significant reordering of our nation’s priorities, an even-handed frugality with a tight rein on spending for Cheddi and the PPP/C to turn things around in our country. By squeezing all around, enough money was mustered to fund our first expansion in generation of 11 MW when GEC at the time had a notional supply of 30 MW. We advertised publicly for proposals. More than a dozen offered reconditioned gensets but we thought that since reliability was most critical we would prefer brand-new units. The Wartsila offer was the lowest of brand-new units (quite possibly Wartsila had foregone any profits in that offer, as an investment to get their foot into Guyana) but the Wartsila brand and performance were then unknown in Guyana. As it happened, Dr. Jagan at Omai for its opening, when touring their Wartsila power plant, received such complimentary remarks about Wartsila, he recommended that we consider Wartsila’s price and performance guarantee as credible. To pre-empt any compromise of Wartsila’s guarantees and its performance, I advocated and sought approvals (on both sides) for an operations and maintenance contract between GEC and Wartsila. I admit it was my “cya” strategy.

The two units brought tremendous improvement but we knew that many more were needed, and quickly so. With this example establishing costs and benefits we, Cheddi with the PPP/C, spent some months trying to promote local funding of the next tranches of gensets. Not enough of us Guyanese seemed ready to believe that we Guyanese were ready to do what was required to develop an efficient, respectable, profitable utility on our own. As I recall, it was only a few days after our Government eventually ordered a second tranche of two Wartsila units that a large failure at the steam plant at Kingstion prompted the immediate ordering of an additional four units to follow on. Unfortunately, Cheddi passed away before the last four were brought into service.

Cheddi had also been receiving representations to replace the almost totally dead plant at Anna Regina on the Essequibo coast. He had the pleasure of commissioning a brand new 4 MW (2 x 2MW) plant in May 1995.

Mr. Editor it was Cheddi who after many long meetings, the experiences referred to above, and the obvious needs for inputs of capital, new, additional and different experiences and expertise, eventually acceded to starting on the road to privatizing the GEC for the development of Guyana and its people. Notwithstanding our reluctance to consider recovering our GEC ourselves, the overwhelming number of us Guyanese seemed concerned about our GEC (now GPL) in foreign hands. I recall a few days before he took ill a number of Guyanese persons were trying to persuade Cheddi not to privatize. His answer essentially was, bring me and bring me quickly a credible alternative to privatization. It would take about two years after Cheddi’s passing for the GPL privatization to be completed but the agreements bore his imprint – a 50:50 partnership and both the Government and Core-Partner selling down their shareholding over years ten to twenty. Cheddi’s dream was for every Guyanese customer family to acquire about the same number of shares, and thus being at the same time both owner as well as customer, sensing, resolving and reconciling the contradictions of the two roles.

Mr. Editor I hope that you have been persuaded that Cheddi could hardly have given more useful time to the problems, challenges and hopes for GEC. And please allow me to add that the time he spent (much later) on developing and formalizing his ‘New Global Human Order’ were all to the same end: all part of seeking and justifying debt forgiveness to allow us Guyanese a real chance for a better life.

Mr. Editor, we, the PPP/C, would be among the first to admit that over our period in office we did not reach where we aimed for GPL (and for many other aspects in our Guyana) but we steadily and greatly improved the supply of electricity across our country, improving average supply time from about 60% to about 95%, at the same time increasing the number of customers from about 75,000 to 175,000.

After Cheddi’s passing we added a further 60MW in generation in two new plants, one at Kingston and the other at a new site at Vreed-en Hoop. It was timely then to turn to major upgrades of the transmission system installing almost 100 kM of new 69kV transmission lines which completed at long last the Demerara-Berbice Interconnection. Eight new substations were installed at calculated locations in the network enabling 27 additional distribution circuits allowing shorter runs and greater isolation of local problems. Three existing substations at Sophia and the two main generating stations were upgraded. A new Control Centre was built at Sophia with a new Supervisory Control and Data Acquisition System linking all substations to the Control Centre.

Mr. Editor, after some delay the Coalition Government is getting the new generating stations required for Anna Regina and Bartica. We paid on average US$ 1.0 million per MW over 1993 to 1997 and US$ 1.1 million per MW over 2009 to 2014 for complete power plants, inclusive of cost over-runs but excluding any cost for land. Recalling all their allegations of hundreds of billions of dollars of annual corruption, may I be wicked and enquire what is their total plant cost per MW? If they are without corruption it shouldn’t be more than ours!

We greatly regret not being allowed to proceed with the construction of Amaila which was contemplated even in the Burnham years of the mid 1970s. By now, we would have started receiving electricity (165MW) from Amaila at a sustainable, lifetime average price still much less than the current prices lowered by low oil prices and our Coalition Government could have claimed Guyana’s first big step to a ‘Green’ Guyana and effecting half of its commitment towards making Guyana a Green State. Natural gas may not be much cheaper than HFO. It would be low carbon but not ‘Green’.

We neither forgot nor ignored our interior. We reached nearly every home. We provided an initiating degree of electrification across our hinterland with the provision and installation of nearly 20,000 photo-voltaic solar home electrification systems in spread-out communities and a number of mini-grids with 24×7 electrification at their cores and across denser communities, an essential plank for their subsequent proclamation as towns.

Mr. Editor even as I acknowledge that I am partisan and personally involved, nonetheless, I urge you to reconsider your painting of our 1992 to 2015 period in office with the same broad brush as you paint the preceeding and subsequent periods.
Samuel A. A. Hinds
Former Prime Minister, Former President and Former Minister Responsible for Energy and Electricity

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