Addressing the media at a press conference yesterday at the Presidential Secretariat, President Bharrat Jagdeo said management of the Guyana Power and Light (GPL) has “failed totally, and any solution would have to see them leaving the company.” The CDC, he said, cannot absolve itself from blame since that company “chose the managers”.

President Bharrat Jagdeo noted the “contentious issues” that must be dealt with and said he is to become more involved in the GPL matter in the coming days.

Alluding to the company’s “big dilemma” - high rates yet falling short of the company’s liabilities - the President said government has to make tough decisions.

Earlier this year, the GPL was barred from increasing tariffs by a Court injunction. It has since claimed that it is cash-strapped and has closed the Kingston Steam Plant. Prolonged blackouts have resumed and these have been attributed to problems in the system.

“I’m very concerned about the blackouts… There are some very contentious issues that we have to deal with. Although the rates are so high - I understand the hardships that they have brought to people -collections are still less than the liabilities of the company, that is, to buy fuel and to pay staff and to buy other things to run the company. That is a big dilemma because if your revenue can’t cover your costs, your services would suffer, and that’s what we’re seeing now. But we have to find a way of solving this and I am going to get much more involved in it over the next few days. We have to find an outcome that would make sure we don’t have more blackouts, and an outcome that would eventually see some efficiency being done in this company.

“But the thing is the current management has failed totally, absolutely and any solution would have to see their replacement. Any solution to this matter would have to see them leaving the company,” the President reiterated.

He acknowledged though, that if the current tariffs cannot cover the GPL’s liabilities, then, in the short-term, there must be an increase in tariffs

“Any new arrangement will have to do a number of things: if it has a temporary increase in tariffs, it must have a potential for reducing the tariff once the fuel rate comes down, because the fuel would have added tremendously to the increase. But there must be enough capital to deal with the line loss and also the commercial loss,” he said.

The President added that the current management did not deal effectively with the line losses and the commercial losses.

“So what you have effectively is that 55 per cent of the customer base paying for all the electricity that is generated, while 45 per cent is lost either through theft, or through the line,” he noted, adding that there must be enough capital to aggressively grapple with line losses and theft in order to collect more revenue without having to increase tariff.