Foreign investors for
Guyana's Electric Corp?

by Bert Wilkinson, Georgetown- Guyana

It is just about 11:30 pm on Saturday April, 20. Thousands of people in this boxing- mad country wait for the feature boxing presentation to be pirated from American satellites orbiting high above the earth.

But they are going to be disappointed, not because the pirate station looses the satellite feed, but because the state run Guyana Electricity Corporation (GEC) would experience a complete electrical shutdown...this time the failure would last a horrifying 17 straight hours.

The shutdown would paralyse the entire 15 square- mile capital. The affected area stretches for more than 150 miles along the coast and beyond Struggling engineers manage to get the system up and working again by Sunday evening. Since that time there has been two versions and although they were shorter, the frequency of blackouts seem to be increasing.

Virtually no- one believes Government assurances that things would get better until the ailing system is completely scrapped. Boxing fans threw up their hands in despair, frustrated investors wonder when it would all end and the people who were not at home or at the worksite to unplug electronic equipment when the blackout started, are justifiably worried about the damage that can occur both when power is lost and when it is returned.

Without any warning, just as the power is frequently cut, engineers have over the years suddenly re- energised the system, wrecking everything from TV's to juicers. Already abnormally high voltage surges after an outage is repaired caused the destruction of three separate family homes by fire in Northern Georgetown earlier this year. There are numerious other cases which are similar in nature. The company has not once compensated even the fire victims.

Because of the financial position of the utility, few have even bothered to take legal action, and instead they have concentrated their attention on the struggle of rebuilding or others are simply chosing to migrate. To the Guyanese, life in the dark has been the norm since 1978 when the geriatric 30- year plus main Kingston Power Station in the city first started to indicate it had enough.

Nearly twenty years and three Presidents later, the situation has worsten.. and this is despite the injection of US$70 million from the Inter- American Development Bank (IDB), other sources of loans as well as direct and indirect subsidies and financing from the state. Critics say the money spent on keeping the "dead alive" could be better spent on new equipment and improving the transmission and distribution systems.

The Cheddi Jagan administration, which came to power in 1992, which vigorously promised to end the blackouts, has still "left the people without power." Some political observers say the current administration is making the same mistakes of its predecessors by trying the patch the steam generators and periodically adding a new machine or two. But these bring little comfort, because they are connected to a national grid system. An electrical trip out at Kingston usually carries the convertor station at the city's east end which starts a chain reaction that trips off the substation at Garden of Eden, 14 miles south of Georgetown. The end result renders the entire grid useless and plunges the coastal areas into darkness.

Until the middle of April, Jagan, 78, a reformed communist, has stoutly resisted domestic and international calls for privatization. Instead he has chosen to follow the advice of top party officials, including former Electricity Corporation Chairman Raymond Gaskin. Gaskin believes that the utility could be profitably run if the right management team could be found, corruption weeded out and workers morale is improved. But, despite the launch of an anti- corruption campaign and the replacement of the utility's top management, the corporation still publishes daily eight hour full page newspaper blackout schedules, and is often forced on the defensive when their are mechenical trips.

So erratic has been the power supply during February and March that the Government appointed Public Utilities Commission called managers to a public hearing on April 27. In giving and update of the state of the utility to the Commission, General Manager, Robin Singh reported that by the end of the year the reliability of the electricity service will be noticably improved as the utility aquires new equipment to booster its operations. Additional hearings have been scheduled.

Blame of the sorry state of the utility has also been passed on the the shoulders of former President Desmond Hoyte. During its final years in office, the Hoyte administration dithered on selling off the company, despite the urgings of investors, the Guyanese public and multi- lateral lending agencies including the IMF. A poll conducted by a prominent local accounting firm Christopher L Ram and Co showed that more than 60 percent of the country's businessmen want the Cheddi Jagan administration to move expeditiously and divest the company. The report on the poll in which 36 local entrepreneurs and corporate executives were involved, was released over the weekend to journalists and came just prior to an announcement by Government that the Inter- American Development Bank will contribute US$75,000 to finance moves by the GEC to find an investment and management partner by year's end.

Prime Minister Sam Hinds says Government is ready to consider this and other options. One option that seems to be getting serious consideration is the the plan to award a contract for private management contractors to administer the facility. Florida Light and Power, Leucada of Salt Lake City, Utah and a few other companies are queing up to place their bids.

In making the announcement Hinds admitted that Government's attitude in the past was influenced by the feeling in official circles that the solution could be found within the country. But the nation's humiliation with the performance of the utility over the course of April along with outright condemnation from even its best supporters, has clearly forced its hand.

The publicly owned Starbroek News called for the company to be sold "for a dollar," while former US President Jimmy Carter warned that investors will bypass Guyanan if the situation persists. While the outages continue, frustrated Guyanese usually urge authorities to take a cue from the Canadian- run Omai Gold mines at its mining sites 100 miles southwest of the capital. The mine, deep in the Amazon jungle, has access to 47 megawatts of power. This is more than is usually available from the coastal power system.

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