THE recent daily protracted power outages being experienced across the country have been linked to a deficit in electricity generation, and the consequences of these blackouts and rate at which they occur is testimony to the importance of the Gas-to-Energy Project for Guyana.

Over the past weeks, Guyanese have been experiencing a significant increase in power outages and load shedding across the country. Citizens have encountered prolonged daily blackouts in various areas along the East and West Coast of Demerara, the East and West Bank of Demerara, Georgetown and Bartica.

The recent public outcry on social media about the negative impacts of the blackouts prompted Government officials, including the President of Guyana, Dr. Mohamed Irfaan Ali, as well as Vice President, Dr. Bharrat Jagdeo, to come forward to assure citizens that there is a plan in place to address the blackout woes—including the Gas-to-Energy project, which will add a capacity of 300 megawatts to the system and meet the grid’s demand.

In a live broadcast, the President raised several key points relating to the contributing factors of the frequent outages. It was highlighted that there has been a marked increase in demand for power and electricity over the past three years, which cannot be satisfied by the country’s electricity supplier, the Guyana Power and Light Incorporated (GPL).

Dating back to 2020, the President revealed that prior to the introduction of subsidies on the cost of electricity, the company was comfortably generating 120 megawatts (MW) of electricity to meet the demand of 115(MW). However, with the introduction of subsidised electricity, a number of large companies that were off of GPL’s grid, and producing their own power, decided to return as it was more cost-effective for them. As a result, there was a major disruption in the generation-to-demand ratio. At present, the country has a generating capacity of 174 MW while the demand has increased to 185MW.

As a short-term solution, the President implored commercial users with their own generation capacity to stay off the grid and self-generate during the peak hours between 13:00hrs and 15:00hrs and then 18:00hrs to 22:00hrs daily. Government will be imposing a ‘punitive tax’ on these companies who remain on the grid during peak hours. However, the ripple effect of this measure could mean that these companies may incur additional production or operational costs which may then lead to a rise in cost for their goods and services.

Taking these factors into consideration, the Gas-to-Energy project now sits on the pedestal of vast importance since it is clear that it is the long-term solution. The project is moving apace to come online in 2024 and promises to be a major change for Guyana’s power generation capabilities, which will see the country moving from a heavy fuel plant to a natural gas fuel plant. On this basis, the project will decrease emissions and the impact on air quality, and reduce wholesale power costs by as much as 50 per cent.

A sum of GY $43.3 billion was approved by the National Assembly earlier this year to commence transmission and distribution works. In August, an additional GY$5 billion was approved to be used mainly for the engineering, procurement and construction (EPC) contract.

The Maritime Administration Department (MARAD) also announced that, on October 1, pipe laying activities were scheduled to commence from the West Coast of Demerara to offshore, within Guyana’s Exclusive Economic Zone.

While various individuals and bodies have come forward calling for the Gas-to-Energy project to be halted on their whims that the project has negative implications, it is clear that this project will be both transformative and a breakthrough for Guyana. The project will help households and businesses enormously by cutting the present high costs of electricity and it will play an integral role in reducing the plague of blackouts in the country.