With interest mounting from firms in neighbouring Brazil for the revival of the Amaila Falls Hydropower Project (AFHP), the Guyana Government is now getting proposals from more companies around the world, including in Europe and Asia.
Vice President Dr Bharrat Jagdeo, during a press conference on Thursday, revealed that Government would soon be relaunching the competitive bidding process in order to revive this critical initiative.
“We’re hoping, within maybe maximum two weeks, to go out back for the Request for Proposal… Up to last week, 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 stated.
According to the Vice President, instructions have already been passed on to the technical staff to prepare to launch the new Request for Proposal (RFP). This includes updating the data from the last RFP to reflect new developments, such as the change in electricity demand.
“But we had most of the documents from the past already, so we just need to update them to see that they are more up-to-date,” Jagdeo noted.
The 165-megawatt AFHP was the flagship initiative of the Bharrat Jagdeo-crafted Low Carbon Development Strategy (LCDS), but 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 A Partnership for National Unity (APNU) and Alliance For Change (AFC) opposition parties, holding majority seats in the National Assembly, had both expressed concerns about the project, and had 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 revival of the 165-megawatt hydropower project was one of the promises made by the ruling People’s Progressive Party/Civic (PPP/C) in its 2020 Manifesto. Construction of the Amaila Falls Hydro Project was supposed to start last year, with an expected completion date being in 2027.
The AFHP was awarded to China Railway First Group (CRFG) in November 2021, but the contract negotiations were stalled, and eventually annulled after the company indicated to Government its inability to execute the project in keeping with the Build-Own-Operate-Transfer (BOOT) model: an arrangement that Government insists on keeping. CRFG wanted to enter into an engineering, procurement and construction (EPC) contract with the Government instead, but this was not facilitated.
At the time of that bidding process, Government had agreed to pursue the AFHP via the BOOT model, wherein the contractor would supply electricity to the Guyana Power and Light (GPL) Inc at a cost not exceeding US$0.07737 per kWh, and wherein the company would provide the entire equity required by the project and undertake all the risks associated with the project.
According to VP Jagdeo during a previous press briefing in August, several of the proposals received from bilateral sources are offering the same US$0.07 per kWh.
Only in July, the Vice President had disclosed 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.
Meanwhile, back in October 2022, Canadian High Commissioner to Guyana, Mark Berman, had 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. In fact, 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 provide assistance to Guyana.
AFHP is expected to deliver a steady source of clean, renewable energy which is affordable and reliable, and is envisioned to meet a significant portion of Guyana’s domestic energy needs. This project is one of the key features in the Guyana Government’s energy mix as the country moves towards reducing its dependency on fossil fuels.
The leading initiative driving this transition is the model Gas-to-Energy (GtE) project, which includes the construction of an Integrated Natural Gas Liquid (NGL) plant and a 300-megawatt (MW) combined cycle power plant at Wales, West Bank Demerara (WBD).
