Vaz defends $24 billion JPS loan, says no additional funds planned

Energy Minister Daryl Vaz says there is no proposal for any additional public funds beyond the US$150 million (J$24 billion) loan provided to the Jamaica Public Service Company (JPS) to fast-track electricity restoration following Hurricane Melissa.

In Parliament yesterday, members of the Opposition People's National Party intensified their scrutiny of the five-year loan, citing the JPS licence, which is due to expire in 2027, and the shortfall in the company's estimates to rebuild its infrastructure.

"My concern is that my Government is lending from taxpayers’ money US$150 million to JPS. I need to know if that is a wise financial transaction... I have a right to know that," said Dayton Campbell, the MP for Westmoreland Eastern, in a grilling of Finance Minister Fayval Williams.

"The answer to that question is not just that people want light; If it is they (JPS) required US$350 and their licence only has two more years on it then any prudent individual is going to think twice before they lend them the money because they have no guarantee to continue operating beyond two years. So, on what basis did the finance ministry take a decision to lend the US$150m?"

Williams told Campbell and other opposition members with questions to direct them to the Energy Minister.

At Wednesday’s news conference, Vaz dismissed the concerns as "mischief."

"There is no proposal in front of us for any additional money outside of the US$150 million. So, I want to make that very, very clear," he said.

He also said the loan amount was "not picked up out of a hat" as JPS requested US$75 million per month for two months "to bring us full restoration."

According to the minister, JPS' original estimate was US$480 to US$600 million, which was revised down to US$350 to US$400 million.

"So, yesterday in Parliament, again the noise and the mischief about the fact that the US$150 million is not enough, where is the other US$200 or US$250 million coming from. That’s not a discussion that we have had with the JPS. We have had a discussion about US$150 million," said Vaz.

He added: "The JPS is owned majority privately, so the Government has no obligation to fund a private entity. We did so in this case because of the benefits and therefore we have nothing in front of us either to qualify at this stage the amount or the final assessment of the amount of money that Melissa has caused damage to JPS. We don’t have it from the JPS and I don’t have it from the OUR so I can’t speak to any other figure other than what is out there.”

Vaz also reiterated that the status of the JPS licence, due to expire in 2027, was a factor in the loan decision. JPS had requested a 15-year extension on the licence as part of its efforts to recover from the hurricane.

But Vaz noted that he and the Government gave a "commitment" that the "flawed" licence that expires in 2027 would not be renewed on the same terms.

"In order for us not to grant the 15 years that was asked for by JPS and the eight to 10 years that the multilaterals asked for to fund the JPS we decided to be a responsible, caring government and lend the US$150 million for five years with simple terms, 5.5% which is very concessionary because we don’t want a pass through for increased bills because of interest rates," he told journalists.

Vaz said the rationale for the loan and the benefits to the people in the affected parishes and wider Jamaica are "very straightforward," and a delay in full restoration of up to six more months is "unbearable for the people and it is absolutely unacceptable for our government in a recovery mode."

"It affects government and business revenues; JPS's revenue to enhance their financing ability to continue the work that needs to be done after restoration. It restores jobs, creates new jobs and business opportunities in the most affected areas and across Jamaica ... This is a wise business decision, a wise government decision and it's a responsible decision that we will not back away from. And I want to indicate, I as minister, if I had to do it, I would do it every day and twice on Sundays. So I take full responsibility and I have no apologies and I have no explanation because the people who are suffering get it."

JPS had previously indicated it required more than US$350 million to fully restore power, with completion initially projected for April-May 2026. With the loan, the revised timeline is now by the end of January 2026.

-Karen Madden

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