Home' Trinidad and Tobago Guardian : May 5th 2013 Contents A30
Sunday Guardian www.guardian.co.tt May 5, 2013
Guyana s inte-
height of Niagara, and incomparably
more beautiful. An airstrip brings a
trickle of tourists.
Waterfalls can earn more than tourist
cash. A 25-mile trek from Kaieteur are
the Amaila Falls, almost as impressive
but ten times as inaccessible, and the
site for a planned hydro-electric
Guyanese have talked of hydro-
power for decades. They have potential
to generate at least 20 times the coun-
try s present power demand.
In the 1970s, planners talked of a
huge dam on the Mazaruni River. World
Bank finance was blocked by Venezuela,
which claims western Guyana as its
own. In 2009 Brazil proposed a dam
to supply all of Guyana, with a surplus
for export. The Guyanese government
showed only modest interest.
Meanwhile, consumers suffer a woe-
ful electricity supply, generated from
imported oil. Costs are high and power
outages frequent. "My electricity bill
is more than my rent" complains a
Georgetown businessman. Three were
shot dead in Linden last July, in a
protest over electricity prices.
The state-owned electricity company
Guyana Power and Light loses almost
one sixth of its current to theft. Their
head of security was killed during a
May 2009 raid on illegal connections.
Cheats include "reputable" businesses
as well as low-income families.
When running at maximum output,
Amaila Falls could supply all Guyana s
present power needs. Twenty years
from completion, when the capital cost
has been paid off, ownership would
pass to GPL.
For many hydro-schemes, the envi-
ronmental impact is the big killer. Suri-
name last month dropped its Tapajai
hydro project because it threatened
both river flow and the traditional way
of life of riverside maroon communi-
Amaila has fewer problems. The
flooded area would be small---around
nine square miles. No Amerindian set-
tlements are directly threatened. And
Guyana would move from fossil fuels
to low-carbon electricity.
Sounds good? Maybe. But this costly
project may not in fact cut Guyana s
monthly light bills, or even produce a
reliable supply. Many Guyanese are
GPL s annual payment to Amaila will
be around TT$650 million, more than
it has been paying in most years for
imported fuel---though the developers
argue that consumers will be shielded
from soaring oil prices in future years.
Drought is a big risk. Guyana s rains
seem incessant, but they are not. Peri-
odic El Niño events shift rainfall pat-
terns in South
the plant will
run below full capacity from October
to April. To guard against severe
droughts, Guyana Power and Light will
have to maintain---and pay for---a back-
up power supply.
Sithe Global, part of the US-based
Blackstone Group, has been leading
the project since 2009. They want a
guaranteed 19 per cent return on their
The China Railway First Group has
the main construction contract, and
the China Development Bank will pro-
vide most of the funding. The cost
estimate has crept up, from TT$1.9
billion in 2007 to TT$5.4 billion today,
close to one-third of Guyana s GDP.
The scheme has been under discus-
sion since at least the mid-1990s. In
2001, there was confident talk of a
June 2002 start to construction.
The site remains inaccessible. Asked
if they ve visited, most of the planners
say "I ve flown over it." A planned 110-
km access road is long past its sched-
uled completion date.
International lending agencies are
cautious. The IMF wants "careful con-
sideration of the risks." The World Bank
was involved in initial discussions, but
drew back after a due diligence study.
The Inter-American Development
Bank has been asked to contribute
TT$1.1 billion, and is in the midst of
its own due diligence process. The talk
now is of financial closure by the end
Most of Amaila s risks will be carried
by the Guyanese consumer. But the
IDB is treating this huge scheme as a
private sector project, with private sec-
tor rules on transparency and account-
There is still no economic feasibility
study. When there is one, it will remain
confidential. Amaila s power purchase
agreement with Guyana Power and
Light is also confidential. Unwisely,
the IDB has not yet found time for dis-
cussions with the opposition parties.
In the National Assembly, the oppo-
sition parties hold a narrow majority.
On April 24, they voted down a
TT$600 million budget allocation for
an equity stake in Amaila.
They are unlikely to agree funding
until they have a chance to study its
likely impact on the Guyanese con-
The government argues, quite cor-
rectly, that Guyana needs hydro power.
The opposition retorts, equally correct,
that Amaila has a history of delays,
secrecy and soaring cost estimates. An
open debate could clear the way.
If the detailed sums now look good,
they can win consensus support. If
they don t, the project s backers should
WILL THE CASH FLOW?
Guyana's Kaieteur Falls. Looking like a billion dollars?
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