Wednesday, Sep 18, 2019
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Responsibility for BPL

It gives us no satisfaction to return to the Bahamas Power and Light (BPL) blackouts and the many excuses proffered by the powers that be.

Many outlandish statements are being made by the government and BPL.

First, Minister Desmond Bannister told us that the blackouts were not as bad as they had been under the last Progressive Liberal Party (PLP) government. Then he said the blackouts were not a crisis.

BPL Chairman Dr. Donovan Moxey told a Rotary luncheon that BPL could have rented additional generators to prevent the blackouts but did not do so because they did not have the money.

And finally, over the weekend and again on Monday, the prime minister, after months of silence, admitted that the daily blackouts are in fact a crisis for people living in New Providence.

He said he spent two months “gathering the facts” because he was not previously “cognizant of the challenges”. This from a man who spent five years as a Cabinet minister followed by another five years as leader of the opposition and now 27 months as prime minister!

How is it that the prime minister is only now committing his government to respond to the “emergency situation” at BPL and to use “all of its resources and talent and move resources around…” to fix it?

He used the occasion to suggest that his government will fix BPL’s problems after 20 years of neglect as he fixed the problem at the New Providence Landfill.

The plan being implemented now is based on a plan that was left behind by his immediate successor in the portfolio for which he had responsibility as Cabinet minister for health.

He might have acknowledged the great gifts he inherited from those same 20 years: an expanded Prince George Dock; Lynden Pindling International Airport; Baha Mar; Albany; expanded Arawak Cay and ADP; economic growth; increased private sector jobs; plans for fiscal policy reform; value-added tax (VAT); which he initially opposed but which he then increased by 60 percent, allowing his government to extract hundreds of millions of dollars from the public; and of course the University of The Bahamas (UB) that will benefit from his signature program – free tuition for all and sundry.

And, he might have told us why he rejected the plan left by the PLP without a replacement plan of his own.

And he may have advised why the offer made in January 2018 from New Fortress Energy (NFE), an American company with a track record, was not accepted. The offer provided for the following:

• 200+MW (megawatts) of long-term power at $0, 100/kwh for a 20-year term, delivered within 18 months of contract signing;

• Fully self-financed by NFE with no capital required from BPL or The Bahamas, and no financing contingencies;

• Turnkey, transitional power at $0, 125/kwh (kilowatt hour) fixed-rate pricing, delivered no later than 60 days from contract signing and saving approximately $20m+ per year for The Bahamas;

• 80 MW of firm power as requested in the tender, with an additional 60 MW available as needed;

• Turnkey conversion of BPL Hitachi units to natural gas, all at NFE’s sole cost and expense (no capital required from BPL or The Bahamas);

• Natural gas in service within three months of authorizations, which we believe can occur within six months from contract signing;

• A $600 million Rate Reduction Bond offering to pay off BEC legacy debt and remove it permanently from The Bahamas government’s balance sheet, led and arranged by NFE and CFAL; and

• LNG bunkering and transhipment hub designed, developed and constructed by NFE based at Grand Bahama, with a $0.50/MMBtu throughput fee for the benefit of The Bahamas.

Had that offer been accepted, it is very likely that 200MW of power would have become available by June 2019 and New Providence would have been spared the horrendous summer of blackouts.

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