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'Not about delay' - Energy committee co-chair just wants best info on 360MW project

Published:Wednesday | February 5, 2014 | 12:00 AM
Dr Carlton Davis

Daraine Luton, Senior Staff Reporter

CO-CHAIR of the Energy Monitoring Committee (EMC), Dr Carlton Davis, said yesterday he was hoping Phillip Paulwell, the energy minister, would provide answers to some critical issues relating to the 360-megawatt power plant project when he meets with the committee tomorrow.

Davis, who is special adviser to Prime Minister Portia Simspon Miller, told The Gleaner yesterday that the committee wants to be satisfied Energy World International (EWI) has the capacity to execute the project.

Davies, who chairs the committee with Peter Melhado, said all the information received to-date suggests there is nothing untoward that would prevent business from being conducted with EWI.

He told The Gleaner that the core issues concerning the committee at this point relate to financing and logistics.

"Since the thing is based on natural gas, it is the issue of getting it here and having to convert it here from liquified natural gas to natural gas, and then being able to meet that schedule of what construction has to be done here in respect of the gas and what construction has to be done in respect of the generating plant," Davis told The Gleaner.

"My own perspective [is that], we are not talking about delaying, ... [but] we are talking about getting definitive reports as to precisely where we are," Davis added.

On Monday, powerful private sector interests in Jamaica said they wanted the Office of Utilities Regulation (OUR) to delay recommending to Paulwell that EWI be granted a licence to construct a power plant to supply the national grid with 360MW of base-load capacity.

The Jamaica Chamber of Commerce, Jamaica Manufacturers' Association, and the Private Sector Organisation of Jamaica have expressed fear that the OUR could make a recommendation to Paulwell for the issuing of a licence, even though the joint public-private EMC insists that there are a number of important items that require further examination and analysis before the OUR can make a positive recommendation.

Under the OUR Act, the regulator, in deciding whether to recommend to the minister that an applicant be granted a licence, must satisfy itself that the applicant will, among other things, meet the needs of the country.

The OUR must also be satisfied that the applicant will operate efficiently, and that it will operate in a manner that will protect the health and well-being of users of the service and such elements of the public as would normally be expected to be affected by its operation.

The law further states that the OUR must satisfy itself that other persons financing the operation of the utility are on board with the financing, and that the project will provide a reasonable return on capital invested.

The OUR on Monday met with principals of EWI, and will, this week, be locked in meetings to discuss the issue of project financing. The Hong Kong-based EWI has been selected as the preferred bidder in the base-load, generating-capacity project, which is a central plank in the push to reduce Jamaica's energy cost.

The company says it will cost US$737 million to execute the project. It has already paid a one per cent bid bond, and will soon be required to post a five per cent performance bond, which will become due prior to construction.

Davies said when the minister meets with the committee tomorrow, he is expected to provide an update on the progress being made with the project. He said following that meeting, it will be determined whether the committee will seek to have a meeting with EWI.

"I am not asking for any delay. We are just trying to get the best information to make a judgement as to what are the probabilities of certain things happening according to plan," Davis told The Gleaner.

On Monday, powerful private sector interests in Jamaica said they wanted the Office of Utilities Regulation (OUR) to delay recommending to Paulwell that EWI be granted a licence to construct a power plant to supply the national grid with 360MW of base-load capacity.

The Jamaica Chamber of Commerce, Jamaica Manufac-turers' Association, and the Private Sector Organisation of Jamaica have expressed fear that the OUR could make a recommendation to Paulwell for the issuing of a licence, even though the joint public-private EMC insists that there are a number of important items that require further examination and analysis before the OUR can make a positive recommendation.

The OUR on Monday met with principals of EWI, and will, this week, be locked in meetings to discuss the issue of project financing. The Hong Kong-based EWI has been selected as the preferred bidder in the base-load, generating-capacity project, which is a central plank in the push to reduce Jamaica's energy cost.

The company says it will cost US$737 million to execute the project.

Davies said when the minister meets with the committee tomorrow, he is expected to provide an update on the progress being made with the project. He said following that meeting, it will be determined whether the committee will seek to have a meeting with EWI.