August 25, 2014
Franklyn Wilson, chairman of FOCOL Holdings, has thrown his support behind the government selecting a company which will implement a "multi-fuel" approach to electricity generation as part of its efforts to reform the Bahamas Electricity Corporation and reduce power costs.
Wilson was contacted to respond to comments made by Chairman of the Bahamas Chamber of Commerce and Employers Confederation (BCCEC) Robert Myers indicating that the chamber views the implementation of natural gas-fueled generation as the "preference" for The Bahamas based on evidence.
Wilson said: "Fuel circumstances change over time, and what might be the fuel of choice at a particular time for an extended period may not be the fuel of choice permanently, so as a general concept I think the way power plants are moving, in terms of its approach to technology and the use of fuels, is for flexibility," he said.
In 2013, Wilson said that FOCOL, along with the Grand Bahama Power Company's major shareholder, Emera, and electrical turbine manufacturer, Wartsila, submitted a joint venture bid to construct a 100 megawatt multi-fuel power plant to relieve BEC of some of its generation responsibilities.
Following the announcement of the BEC RFP process, Wilson confirmed the company would not be participating, but would still continue to offer to any winning bidder in the BEC transmission and distribution management contract a power-purchase agreement (PPA).
Wilson touted the plant's potential to save the country $100 million in energy costs per annum.
Asked last week about the status of this bid for involvement, Wilson said that it is "still there" but he said no active discussions have been underway.
"We understand the government's going through this process, and if they are interested, we're available. Our interest has not changed."
Recently, the Bahamas Chamber of Commerce and Employers Confederation commissioned a study from Oxford Economics, a U.K.-based consultancy, showing the economic impact of the installation of a new diesel fired power plant, a power plant fueled by liquified natural gas shipping to The Bahamas, and a power plant fueled by LNG piped to The Bahamas through a specially constructed pipeline from Florida.
Over its 25-year life and two-year construction period, the report proposed that the knock-on economic impact of a power plant fueled by diesel would generate an additional $10.1 billion in economic growth for the country; a plant fueled by piped LNG would generate an additional over $25 billion, said the consultants.
Natural gas has fallen in price in recent years, thanks to the success of U.S. efforts to tap into this abundant resource.
Commenting on the results of the report, which the BCCEC was able to generate by partnering with one of the bidders in the BEC reform process, Myers said: "The numbers with whatever form, diesel, or gas - gas being the preference - the reductions in costs to the consumer, the government and the public, are massive. The knock-on implications are even larger; you become more competitive, you've got considerably more disposable income now left at the feet of government and the public, so that will have a positive impact on GDP and it will counter balance, to a great degree, VAT."
In June, Guardian Business reported that the two unions representing BEC workers - The Bahamas Electrical Workers Union (BEWU) and the Bahamas Electrical Workers Managerial Union (BEWMU) - came out in favor of the government selecting a provider to take over power generation in the country who would do so through the use of natural gas.
Presidents of the unions, Paul Maynard and Clinton Minnis, suggested that no significant good can come of the BEC reform effort unless the current bunker C fuel is substituted for natural gas.
"We have sent a letter to the prime minister, encouraging him to move this country forward wholly into the 21st century and the first world by going natural gas, so these bills can be cut in half to re-energize this economy," said Maynard.
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