The government has formally written to the shareholders of AC Power, its joint-venture partner in the Guyana Power and Light operations expressing dissatisfaction with the management team's performance under the management contract and asking for a review.

Cabinet Secretary, Dr Roger Luncheon on Friday told Stabroek News that the displeasure at the service as well as the failure to meet targets was raised at the recent shareholders meeting between the two sides. He said that the government asked that the contract be reviewed.

AC Power, Luncheon said, asked that the government put its request in writing and this has been done.

AC Power is owned jointly by the Commonwealth Development Corporation (CDC) of the UK and ESB International of Ireland with the latter having the management contract and the former being the financing partner. Questions have been raised in the past about the magnitude of the management fees paid to GPL and why the privatization deal required separate provision for a management contract. The management contract is worth some US$3.5M per annum and is financed from GPL's revenue stream.

The efficacy of GPL's management has arisen in the light of continuing high technical and line losses, which, if they had been reduced, would have improved the financial status of the company. At the end of year one GPL's technical and line losses were to be cut to 34% and then 29% at the end of year two. After year one the figure was 39.3% and for the first nine months of year two the figure was 39%.

Prime Minister Samuel Hinds had said that a substantial review of the performance of the management team had begun and a government director on the company's board had cited the breaches of the management contract.

President Bharrat Jagdeo on Friday asserted that this year the government would insist on GPL seriously examining the issue of renewable energy resources and looking at a power purchase agreement for hydroelectricity. The investment group in the Amaila Falls hydro project has indicated that an agreement with GPL is still elusive and this is a key hindrance in its plans.