CHIEF Executive Officer (CEO) of the Power Producers and Distributors Inc. (PPDI), Arron Fraser, has said that the power company is on target to achieve in excess of US$2M in profits at the end of 2019 as it continues to operate at an optimum.

PPDI, which took over the operations of Wärtsilä in December 2016, is expected to make between US$2.7M and US$3.9M in profits, even as it saves the Government millions of dollars. Wärtsilä is a Finnish company which had been offering operational and maintenance services to Guyana Power and Light (GPL) since 1994. Similar services are now being provided to GPL by PPDI under a three- year Operations and Maintenance Agreement which will end on December 31, 2019.

PPDI manages the Kingston, New Kingston, Vreed-en-Hoop and Garden of Eden power plants. The CEO, while giving media operatives an extensive tour of the power plants at Kingston and Vreed-en-Hoop last week, said PPDI is charging GPL a fixed rate of US$16.87 per megawatt of electricity – US$3.64 less than the fee (US$20.51) Wärtsilä’s had proposed for 2017.

With an estimated production of 650,000 megawatts of electricity per year, GPL is expected to pay PPDI some US$10.9M or approximately GUY$2.3B per annum, saving GPL US$2.4M. Under Wärtsilä, GPL would have had to pay US$13.3M for 2017. With an average yearly expenditure of US$9.6M to US$10M, the PPDI CEO said the company’s return is set way below Wärtsilä’s benchmark.

“Overall we are looking at a margin of just about 8-12 per cent return on revenues. It is a lot less than what our competitor (Wärtsilä) would have gotten,” Fraser had explained to the Guyana Chronicle, while noting that PPDI’s lower bound is set at US$2.7M and upper bound – US$3.9M over the three-year period.
On Thursday last, he told reporters that for the first seven months of 2017, PPDI produced 375,285 megawatts of electricity when compared to 381,347 for the same period last year. The CEO noted, however, that though the production is lower this year, it is based on the demands of its sole client– GPL.

“Our generation is tied to the demand of the grid, so though we might have generated less this year, our output is strictly mandated by what GPL requires, which is what essentially what the customer requires,” he explained.
Fraser stated that though two of the engines at the New Kingston Power Plant are down, the company is still producing electricity at an optimum. “We have one engine that is down for major overhaul…and then the other engine that is down you will see that the alternator is away for some special maintenance work.

So right now at this plant we have three engines that are operational and they are going at full load,” the CEO further explained. It was noted that the alternator was sent to Miami for repairs and is expected to return mid-September, however, it would require another 10 days to allow for installation before it is re-commissioned.

“Two engines that are out we are barely meeting the demands, but peak demand is covered. It is a significant undertaking which is being covered by GPL, in accordance with the contract,” he noted.
Fraser disclosed that for 2017, there are 11 scheduled maintenance sessions.
“The schedule remains the same, but because we are a new company we have been extra diligent in increasing the scope of what we do, so for instance, the alternator that you see now, alternator maintenance was not something we placed a lot of emphasis on in the past,” Fraser posited.

Meanwhile, PPDI Board Chairman Mark Bender said he was pleased with the company’s operations. Bender said in addition to operating at an optimum, the company is big on Occupational Health and Safety. It was pointed out that the power plants, in particular the new power station at Vreed-en-Hoop, have fight fighting capabilities.
The chairman noted that so far for 2017, there have been no accidents or injuries on at the plants which have prevented workers from attending to their duties.

PPDI has a staff size of 134 persons, 80 of whom are technical people. It is headed by a CEO followed by three Deputy CEOs – Finance and Accounting, Technical, Administration. There are also five middle managers – one managing each of the four power plants and the fifth manager oversees the operations of the workshop. Additionally, each plant is staffed by four shifts of four persons.

According to PPDI, key members of its team include six capable field service engineers, who in addition to working in the Guyana power plants, have worked in many similar plants in the Caribbean and Latin America.