Once Sithe’s licence remains valid the government has no control over the Amaila project site

The debate on the Amaila Falls Hydropower project continues to rage two weeks after Sithe Global, the project sponsor, declared that it had pulled out. Cabinet Secretary Dr Roger Luncheon later pronounced the project dead, but then dismissed calls for the revocation of the licence to Sithe by seeming to joke about the value of a licence of a dead project.

Dr Luncheon knows that it is in Guyana’s interest and power to revoke the licence and that once the licence remains valid and unrevoked the government has no control of the designated project site. He must know too that Sithe’s notification to the government of its decision to walk constitutes more than enough grounds for the revocation of the licence.
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An energy policy for Guyana

Introduction
However the Amaila Falls Hydro project turns out, there seems to be an implicit agreement that the country needs an energy policy. Janette Bulkan favours a Green Paper which in Westminster type countries is a document published by the Government as part of the consultation process before any major policy change is undertaken. While the LCDS March 2013 refers to the Amaila project – no doubt because it was already well-advanced – it did not place the project in any policy context. For that and some three years earlier, there was the Guyana Power Sector Policy and Implementation Strategy 2010 done by Verna Klass, which incidentally also anticipated Amaila coming on stream in 2015. But that Strategy included a specific recommendation that the Potaro river basin be developed in stages to meet the increasing requirements of the national grid. That Strategy noted that fuel oil was a better option than wind which it considered “did not seem appropriate for the long term either as it would be displaced by the expected hydro facility”. It also recommended the ongoing use and research into bio-fuels.

And if we go still further back to the National Development Strategy (2001 -2010) we note an entire chapter dedicated to Energy. The NDS looked at alternative energy sources noting that “many ideas for utilising renewable energy sources such as solar and wind power, are appealing, but that the costs are high. It added however that in the view of some experts, the cost of both wind energy applications and solar power generation could be considerably reduced.

The NDS made a number of recommendations some of which are as valid today as they were ten years ago. These included enhancing the energy-generating capacity in the interior districts to increase economic activity in all parts of Guyana, attaining an equitable distribution of economic activity, and eradicating poverty in the most depressed areas of the country; the use of locally available energy resources utilising local production e.g. bagasse in sugar and rice mills, and wood waste in sawmills; tax credits to encourage the use of wind and solar energy; and the exploitation of hydropower centred on Amaila in the Potaro River Basin. It should be noted that the NDS saw Amaila not as a stand-alone project but in a modular framework.
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Response to Gouveia

Dear Editor,

Captain Gouveia’s widely publicised open letter on Amaila in the dailies juxtaposes extracts from statements by Drs. Clive Thomas and Anand Goolsarran and the two signatories to this letter on the one hand, and statements made by the Government on the same or similar issue on the other. The Captain then requests the four of us to answer four critical questions. Ignoring the contribution to the debate by such committed Guyanese as Janette Bulkan, Alfred Bhulai, Tarron Khemraj and Sasenarine Singh, Carl Greenidge, Lincoln Lewis, Charles Sohan and M. Ali, GHK Lall and others, Capt. Gouveia sees the four as “the ones who killed the project”.

Capt. Gouveia did not invite the Government of Guyana to explain its conflicting claims about the virtues of the project or challenge it for underplaying the hydrological, geotechnical and exchange risks associated with the project. One must remember that the Government has so far not tabled in the National Assembly any of the critical documents for the project or sought the Assembly’s approval. Presented by the Government were two peripheral pieces to meet the requirement of a foreign agency. Were it not for that demand, the Government would not have come to the National Assembly and the project could have gone the way of the Marriot and slid away quietly and successfully like the camoudie.

For the benefit of readers, we address the issues under five headings: debt, tariffs, subsidies, fuel and savings, and cost. We now address those issues, make a brief conclusion and raise some questions to Capt. Gouveia.
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