With just two weeks remaining for the submission of proposals for the Amalia Falls Hydropower Project (AFHP), the Guyana Government has changed some of the key requirements regarding joint venture partnerships.
In a notice published in today’s edition of Guyana Times, the Office of the Prime Minister issued an amendment to the Request for Proposals (RFP) for the long-anticipated hydropower project.
The changes, dated December 18, had to do, among other things, with an increase in the number of joint venture (JV) partners allowed for this project. Previously, there was a maximum of three JV partners. This has now been increased to four JV partners for the hydropower project.
These partners are required to meet the minimum qualifications set out.
Additionally, the lead partner within the JV structure must meet no less than 40 per cent, instead of the 50 per cent previously listed, of all the qualifying criteria outlined in the RFP document.
Moreover, each partner, including the lead partner, must meet no less than 25 per cent of all the qualifying criteria detailed in the proposal invite.
“The JV, as a collective entity, must satisfy the qualifying and evaluation criteria. To achieve this, the relevant figure for each partner will be aggregated to determine the total capacity of the JV,” the notice of the amendment stated. It went on to state that each partner of the JV shall assume individual and joint liability for the acts of the JV.
Back in October, the Government reinvited Request for Proposals (RFP) under a Build-Own-Operate-Transfer (BOOT) model with a November 28 deadline for submissions. However, this timeline was further extended to December 29, 2023.
According to published documents from the Prime Minister’s Office, the project will integrate and expand Guyana Power and Light’s national grid capacity to include Linden, Region 10 (Upper Demerara-Berbice).
Interested parties must submit one proposal based on a BOOT model, which includes the construction of a hydro dam, transmission lines from Amaila to Linden plus sub-stations at the Amalia site as well as upgrades and completion of roads and bridges to the site.
According to documents, the hydro project may be re-engineered to take account of changes in turbine technology thus allowing more than 165 MW to be generated and transmitted.
Responses to this RFP will be conducted in three stages: Stage 1: Pre-Qualification of Parties capable of undertaking each of the above (hydro and transmission lines/substations. Pre-qualifications will be conducted on a rolling basis, following which pre-qualified candidates will be allowed access to the data room.
Stage 2: Pre-qualified parties will be asked to provide feedback on the preliminary project structure and project documents. This response will be used to revise the initial project structure and project documents to issue the final RFP by January 31, 2024.
Stage 3: Formal RFP submissions based on the final Project Structure and Contractual documents – due 45 days after issuance of the final Project.
Additional details of the project are found in the daily newspapers where the RFPs are published by the Prime Minister’s Office.
The AFHP – a brainchild of the previous PPP/C Administration has been on the cards since 2011. However, the A Partnership for National Unity (APNU) and the Alliance for Change (AFC) Opposition parties having majority seats in 2014, barred the project from becoming a reality.
The PPP/C outlined the resuscitation of the project in its 2020 Manifesto. Fast forward to 2021, the Cabinet granted a no-objection for the Prime Minister’s Office to engage the China Railway Group Limited to construct the hydro project. However, discussions ended in a deadlock when the company wanted to change the model.
According to reports, the company was unable to secure the necessary financing for the BOOT model, thus the request to change the contract to an Engineering, Procurement, and Construction (EPC) model.
At the time, Vice President Bharrat Jagdeo made it clear that the Government was not keen on the EPC option since the BOOT model would allow the Administration to assume low risk.
Only in October, Jagdeo indicated that there have been mounting interests in the Amaila Falls project from firms in the Region as well as around the world, including in Europe and Asia.
“Up to [September], we’ve had another interest from a Brazilian company. We’ve had a company from Austria [and] several from Korea so now I think there is a large number of people approaching us and the best way to do this is through a public process – a bid process,” Jagdeo had stated.
Meanwhile, the Vice President previously disclosed in July that at least two proposals were received from companies in Brazil to do the hydro project. He had noted too that companies out of the United States have similarly submitted proposals to take over the initiative.
During a visit to the US in December 2022, President Dr Irfaan Ali said he told Energy Secretary Jennifer Granholm and her team that the Amaila Falls project is open to US investors.
Back in October 2022, the Canadian High Commissioner to Guyana, Mark Berman, disclosed that the Canadian Commercial Corporation (CCC) had also held discussions with the Guyana Government on the Amaila Falls Hydropower Project.
Canada is well-known for its hydropower infrastructure. The clean and renewable energy supplied by hydropower accounts for over 60 per cent of all the electricity generated in Canada, and Berman has said this is an area in which Canada could assist Guyana.
The 165-megawatt AFHP was the flagship initiative of the Bharrat Jagdeo-crafted Low Carbon Development Strategy (LCDS). However, the project failed to take off despite having a developer in United States-based Sithe Global, which was backed by investment major – The Blackstone Inc.
In August 2013, Sithe Global announced that it was pulling out of the project, which it said was too large to continue without national consensus and had cited the lack of consensus in Parliament. At the time, the then APNU and AFC Oppositions had both expressed concerns about the project and voted down key pieces of legislation which consequently halted the project.
Then during its term in office from 2015 to 2020, the APNU/AFC coalition Administration again shelved the project.
The Amaila Falls project plays an important role in the Government’s plan to create an energy mix to address the increase in electricity demand while phasing out dependency on fossil fuels that are contributing to global climate change.
The hydropower project coupled with the 300-megawatt (MW) gas-to-energy project and the solar power project, is expected to cut electricity costs by 50 per cent, bringing with it tremendous benefits for citizens and businesses across Guyana.
