The state-of-the-art 20.7 megawatt Kingston Power Plant built to the tune of US$27.5M was yesterday commissioned and consumers can now be assured that the “blackout blues” which have plagued them will now be significantly reduced.

Guyana Power and Light Company (GPL) Chief Executive Officer (CEO), Mr. Bharrat Dindyal, speaking on the occasion convened on the premises of the new structure, told the gathering which included President Bharrat Jagdeo, Prime Minister Samuel Hinds and representatives from the business community that the power plant will allow the company to further reduce its production cost and improve supply reliability.

He also said that power outages occasioned by generation capacity inadequacy have come to an end but outages for network maintenance will continue until December 15.

Dindyal pointed out that in an environment where GPL depends almost entirely on imported fuel and is at the mercy of world market prices, it must adopt prudent measures to control this expenditure.

The top GPL executive reported that in 2007, 47 per cent of the company’s production came from diesel fired generation capacity and in the same year 73 per cent of its turnover was expended on fuel.

In 2008, he said 81 per cent of the turnover was spent on fuel despite production from diesel-fired capacity was reduced to 34 per cent, noting that the increase in expenditure was driven largely by high fuel prices.

“To date in 2009, expenditure on fuel remains a significant burden to GPL with 53 per cent of turnover expended on fuel at the end of October,” the CEO disclosed.

Dindyal said that the peak demand in Demerara has increased from 57 megawatts in 1997, when the nearly Wartsila plant was commissioned to generate 79.3 megawatts.

“During this period 17.5 megawatts of high speed, diesel-fired generating capacity was added to the system. In Demerara, GPL continues to depend heavily on high speed units and most of these have been pressed into base-load operation over the last four years.

“The result has been an increase in forced outages,” he explained.

GPL Chairman, Mr. Winston Brassington, said the new plant will significantly enhance the company’s power capacity but work still needs to be done and this will be given priority attention next year.

Challenges
He said though the Government over the years has invested heavily to improve the operations of the company, it is still encountering some serious challenges, notably in recruiting and retaining skilled personnel and reducing commercial losses; but steps have been taken to address these shortcomings.

President Bharrat Jagdeo, who delivered the feature address, lauded the work of Wartsila, the overseas company which constructed the modern facility.

He pointed out that this year, the National Assembly approved the country’s largest budget and the Government has improved its spending over the previous year as it is fully aware of the importance of the citizenry to access social services.

This vision, the President said, is the driving force behind the Government’s development of economic infrastructure to catapult growth and advance of the country.

Improved spending
“We are expanding our spending while simultaneously reducing the fiscal deficit, and we are not borrowing in a way that will put a burden on the future generation,” Jagdeo underscored.

He said electricity is important for the development of any country and the Government has struggled over the years to inject the resources that are needed in the sector to provide a stable, reliable supply, while at the same time increase spending in the other areas of the economy which were badly “run down”.

Today, he said if the consumers had to pay for the US$125M injected in GPL over the past several years or carry the cost of the fuel subsidies when prices escalated, the rate would have been significantly higher given the technical losses and electricity theft which adversely affect the company’s revenue base.

Longer stay
Jagdeo stressed that even though the Government does not want to remain in the sector, it has had to make a very important decision to stay a while longer.

“We will probable use some of our funds in a catalysing way for the construction of the hydro power; but the model is shifting, the generation of power in the future will come from the private sector and the Government will maintain the difficult part, the distribution and transmission of power, and through this model, we hope that we will be able to supply reliable and cheaper power to people, particularly the private sector.

“This is so vital for our country to move to the next stage of development,” the President told the gathering.