The Bahamas Electricity Corporation (BEC) must be "privatized once and for all", according to BEC Chairman Leslie Miller, who said Bahamians should 'buy it, privatize it and start it from scratch.' Speaking at the Rotary Club of East Nassau last week, Miller conceded that BEC in its present state is "totally out of line" in terms of its high costs and poor performance, and endorsed scrapping BEC and forming a new entity owned and managed by Bahamians.
"What needs to happen is that we need to privatize BEC once and for all but make sure Bahamians own it. We have the ability to pay for it and own it, just like Cable Bahamas. Bahamians could buy BEC today and own it and run it effectively.
"We could turn BEC around. Buy it, privatize it, and start it from scratch," Miller said.
On top of the monumental hurdle presented to any buyer due to archaic infrastructure and high sovereign debt, Miller said that the entire workforce of the corporation needed restructuring. Despite the fierce resistance that Miller anticipated from unions should BEC ever be privatized, Miller believed that the privatization process could result in electricity cost reductions ranging anywhere from 20-40 percent as the company fell in line with the performance-based models of privately owned businesses.
"The best thing for the future of BEC is to be privatized. Privatize it and you will see the difference. You will see your costs go down by a minimum of 20, 30, to 40 percent. We'd catch all kinds of hell from the unions but we need to do it. You can see what happened to [the Bahamas Telecommunications Company]. BTC was privatized and look what happened. There's only so much left and if keep giving and giving the bottom is going to run out," he said.
Private sector demand for a revamped energy sector surged after an island-wide blackout earlier this month resulted in temporary business closures, including notably at Atlantis' casino.
However, Miller said that the cash-strapped corporation required close to $1 billion to get "back on track" through infrastructural overhauls and payment of its sovereign debt but questioned how it would ever secure that financing in its present state. Additionally, no meaningful changes can be made at BEC until the government announces the corporation's new management partner. While some industry officials have speculated that the announcement could be made this week, the government has repeatedly delayed making a decision.
"BEC's sovereign debt right now is $450 million. To get BEC back on track you'd need to borrow a minimum of $750 million. Where's the money coming from?" he said.
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