BIGWIGS from the private sector, academia and government joined forces with President Donald Ramotar to press the case for the Amaila Falls Hydropower Project, which is now in limbo after the Project’s lead investor withdrew citing a lack of political unanimity.

At the third National Economic Forum that opened yesterday at the Guyana International Conference Centre, Private Sector Commission Chairman, Ronald Webster, Minister of Finance, Dr. Ashni Singh and Guyanese born world-renowned Scientist and Professor, Dr. Suresh Narine, took to the podium in turns to extol the merits of the project, as well as rebut its critics.
Webster elaborated on the macroeconomic benefits of the project, pointing out that if the project is not rescued Guyana stands to forego annual foreign currency savings on imported fuel of around US$120 million, and on diesel generator spare parts of US$20 million.
He added that without the project, Guyana remains exposed to the risk of fuel price escalations internationally, warning: “Fuel is a finite resource and [its prices] will continue to rise.”
The PSC Chairman reminded the audience that a scheduled influx of US$80 million from Norway, which was earmarked for use as government equity in the project, might not materialise.
He noted too that with the Amaila Falls Hydropower Project coming online, tariffs would come down low enough for government to remove its electricity subsidies – “subsidies that could be directed elsewhere, UG for example.”
Reflecting on the departure of world renowned institutional investors, Sithe Global, Webster lamented the loss of an opportunity to brand Guyana as an investment destination.
Meanwhile, addressing the significance of the Project to individual businesses; Dr. Singh asserted that besides “cross-cutting” prerequisites such as macroeconomic stability, investment-friendly legislative framework and the skill sets and trainability of the workforce, entrepreneurs also consider the access to reliable and affordable electricity before deciding to invest.
“I know that sitting in this room are…entrepreneurs who every day pay more than they should for electricity, but that notwithstanding confront an unreliable electricity supply,” he observed, while noting that high electricity rates do not augur well for business competitiveness.
Addressing the entrepreneurs directly, Dr. Singh indicated that he is aware that many businesspersons have invested in backup generator sets “even if you only use it for fifteen minutes in the week, even if you only use it for an hour in the week…because of incidents of interruptions in our electricity supply.”
“That ties up capital that could otherwise be invested and used productively in your business,” he reasoned.
Responding to calls that the Amaila Falls Hydropower Project be foregone in favour of alternative source of renewable power, the speakers assured that the Project remains the best option on the table.
“Hydroelectricity, given Guyana’s natural patrimony, represented the most sensible option for sustainable generation of energy with the most lucrative return on investment given the density of energy required,” Professor Narine stressed, adding that out of sixty-seven sites studied, the Amaila Falls location is seen as the one most conducive to hydropower development.
Wind generated electricity, he noted, is regarded as having a higher energy yield than hydropower but wind flows are irregular.
“When the wind blows is not necessarily when you need the energy so wind energy requires energy storage,” Dr. Narine indicated, adding that wind energy storage is as expensive as it is unreliable.
He stated that when stacked against other sources of renewable energy such as solar power, and biomass, hydropower is the “only one capable of the high density of energy required for industrialisation.”
While not precluding the need for investigating those alternative sources of energy, the Professor reiterated, “Hydro represents the best short, medium and long term solution as our main source of industrial and consumer power!”
Dr. Singh, meanwhile, pointed to the difficulty in undertaking large scale energy projects, and noted that a lot of effort had already gone into the Hydropower Project to make it a workable one.
“A small fifty million Guyana dollar project that you manage takes months if not years to put together, to do the necessary studies, to raise the necessary financing, to go to the banks, to convince them,” the Finance Minister reminded investors, going on to note: “It takes years, sometimes decades, to put together a project of this magnitude.”
He stressed that financiers have already lined up to fund the project, stating that along with the Blackstone Group, “major development partners” such as the Inter-American Development Bank and China Development Bank were already on-board.
Dr. Narine, who chairs the Board of Directors of oil and gas explorer, CGX, emphasised that accessing funding in an era of global financial crisis was no small feat, quipping: “Unfortunately, I spend a lot of my time chasing capital, and I can tell you how difficult it is, in today’s climate, to find money.”
“Would we like to spend the next decade or two pursuing some….uncertain, unclear, and not necessarily attainable, option out there instead of seizing the option that is immediately and visibly before us?” Dr. Singh asked rhetorically, adding: “If ever there was a circumstance that lent itself to the analogy about the bird in the hand versus two in the bush, this would be it!”