Bahamas Power and Light (BPL) is awaiting the restart of Parliament in September to ratify legislation that will allow the company to raise more than $530 million on the capital markets, BPL Chairman Dr. Donovan Moxey said yesterday, adding that the company hopes to secure the funding before the end of the year.
Moxey said BPL has completed all of the legislative amendments that its lawyers considered necessary for the rate reduction bond to be legally purposeful and for the company to raise money internationally.
“We’re very comfortable that all of the amendments that need to be made are in place,” Moxey said. “The OAG (Office of the Attorney General) has seen those amendments, Cabinet understands where we are and so from our perspective, we’re just waiting on Parliament to open again so that we can move that process forward. If everything goes according to plan, we’re looking to have that particular funding closed before the end of this year.”
The funding is critical for several BPL initiatives, including servicing $300 million in debt and beginning the construction of a new power plant.
“The construction of Station D requires significant investment and right now the way BPL is in terms of our finances, the rate reduction bond is going to be required for that, unless again, we come up with something else that’s different and completely outside of the box,” said Moxey.
The bond money is also important for BPL’s complete overhaul of New Providence’s antiquated transmission and distribution system. Moxey pointed out yesterday that several recent outages across New Providence were due to faults in the transmission grid and not due to load shedding.
He also explained that BPL and Shell North America are still locked in negotiations over their power purchase agreement. That agreement should have long been concluded, with its formal deadline expiring last year. An already signed agreement would have seen BPL free of the burden of constructing the new power station, but as negotiations lumbered on, both entities agreed that BPL would construct two power plants.
Despite the loggerheads, Moxey said “significant progress” is being made.
“We’re still in negotiations with Shell, we’re continuing to make progress with them,” he said. “At the end of the day, we’re pretty comfortable with how things are progressing. It’s not final yet, but again this is another formal agreement we’ve never done in this country. At the end of the day it is our responsibility to get the best possible deal for the Bahamian people.”