Hydropower key focus of energy self-reliance moves
Power purchase pact would have to be worked out By Andrew Richards
Stabroek News
December 19, 2001

Guyana's efforts to make the country energy self-reliant are on the move with the objective being to vastly decrease the annual US$100 million fuel bill.

Energy coordinator of the Guyana Energy Agency (GEA), Joseph O'Lall, disclosed in an interview with Stabroek News recently that the long-term outlook for the energy sector in Guyana is hydropower.

He pointed out that government has signed memoranda of understanding (MOU) for three massive hydropower projects.

One at Tumatumari for 45 megawatts (MW), one at Takwari Falls for 350 MW, and the other at Amaila Falls for 100 MW, in the first phase, and another 100 MW in the second phase.

The Amaila site is being developed by Synergy Holdings Inc of Guyana and Harza International Development Co, located in Chicago.

The developers of this hydropower station are proposing to supply Guyana Power and Light (GPL), and other load centres which may develop.

"The peak in Guyana is 85 MW. We're saying that the Amaila hydro will service the national grid. Every other firm which comes along will have to find their own load centres," O'Lall stated.

He noted that ENMAN Services Ltd, the Trinidad and Tobago company building the Takwari Falls project, is also developing their own load centres including an aluminium smelter plant and the Tumatumari project would be seeking to supply Omai Gold Mines Ltd.

"The government is just acting as the facilitator of these two projects. In these cases the private sector will be dealing with the private sector in the buying and selling of power," he said.

But there is a special interest in the Amaila Falls project because the developers are interested in selling power to GPL which, in turn, supplies the citizens of the country.

The hydropower station is scheduled to come on stream either in the last quarter of 2004 or the first quarter of 2005.

The feasibility study has been completed and the project is at the stage where an Environmental Impact Assessment has to be conducted.

Power purchase agreement

The cost of producing 1 MW of hydropower is around US$2 million.

Stabroek News understands that the developers have been in consultation with GPL to work out a Power Purchase Agreement (PPA) but no definite answer has been forthcoming from the utility company.

When asked about this O'Lall said: "This is proving to be a stumbling block. If a company wants to set up a power plant how could finance be accessed when there is no PPA?"

He was optimistic that the problem could be overcome.

"I don't see it as an impossible hurdle. All it needs is the political will," he stated.

Under the GPL contract no one is allowed to distribute electricity but its generation is legal.

"Anyone could come into the country and generate electricity. This breeds competition and would bring the prices down," O'Lall said. "With this in mind Guyana should start looking at the energy sector to make it fully competitive, not only for generation but distribution, too."

He pointed out that the percentage of electricity per capita in a country is a reflection of the standard of living in that country.

The efficiency of the electricity supply could be determined by its reliability, quality, affordability, sustainability and quantity, he said.

1950's project

In the 1950s the administration had embarked on a small hydropower project at Tiger Hill in the Demerara River to generate 45-50 MW of power. At that time the demand for electricity was small--about 35 MW at peak hours. This project was abandoned in 1964 when the administration changed. The government sought to embark on another hydro project, this time in the Mazaruni, in the 1970s. This project ran into problems in accessing finance and had to be dropped.

The government brought together a group of qualified personnel in 1994 whose task was to draft an energy policy for the country.

The main objective of the policy, which took two years to be completed, was to reduce the country's high oil bill to Guyana.

In the 1970s, a comprehensive study, to at least the pre-feasibility level, was done of all the hydro resources in Guyana.

The team drafting the policy used the study as part of the basis from which to work.

Guyana has all the forms of renewable energy except for geo-thermal sources. The others are wind, hydro, solar and bio-mass.

The policy dictated that all the programmes in the various energy forms be started at the same time. The programmes were divided into short, medium and long-term components. O'Lall said the programmes sought to address the national grid and the isolated interior locations.

"For the interior, we decided that areas utilising diesel pumps will be replaced with mini hydropower projects and the first to be done was at Moco Moco," he said. That project has been completed and power is now being supplied to Lethem.

He said where there were no hydro resources, alternatives power sources like wind and solar were examined.

Only in very rare cases would diesel be utilised in the interior, he stated.


He said the short-term programme for the coastland was to supply diesel power until a renewable source is established.

The GEA coordinator is maintaining that Guyana is capable of producing enough energy from bio-mass to supply the entire nation.

He explained that the sugar estates have the capacity to produce 2 MW of power but with modern technology this could increase to about 14 MW.

With the eight mills in existence this would amount to at least 80 MW, taking into account shortfalls.

"Presently the demand at GPL is 85 MW and in 2001 the fuel bill would be US$100 million. The sugar mills alone have the capacity to save this amount of foreign exchange," O'Lall stated.

He added that since the sugar industry was facing tough times this could be one alternative for it.

In the wind energy sector, government recently signed an MOU with a Dutch company to set up a wind farm in Guyana. The company is currently measuring the wind on the coast in the Hope beach area.

"By the end of next year they would have installed one turbine of 1 MW capacity. They want to put down at least 7 turbines," O'Lall disclosed. He asserted that if the project proved successful more wind farms would be set up in other parts of Guyana.

In the solar power sector, this type of energy source is considered to be a "stand-alone system."

O'Lall said this system could be installed on the roofs of buildings "to serve self" and this was allowable under the contract GPL signed with government.

His belief was that if there were enough stand-alone systems, the profits would ultimately accrue to government because the administration would have a greatly decreased fuel bill.