Hot mess

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October 17, 2016

The catastrophic failure of the power grid in New Providence is not simply explained.
On the one hand, the much discussed problems of maintenance and repair loom large in the wake of Hurricane Matthew.

On the other hand, the decisions about overtime pay, staffing and cost-cutting must be considered.

But the facts that have become all too apparent are that the equipment is obsolete; it has not been adequately maintained; and this lack of maintenance has bred grave inefficiencies into the system that are impossible to remove without some sort of capital injection.

The reliance on bunker C fuel, the inefficiencies at both Clifton Pier and Blue Hills, and poor managerial decisions about the absolute necessity of proper maintenance of this equipment have resulted in the mess that we see today.

The number of bucket trucks out of commission and inexplicably so, leaves one flabbergasted.

The number of staff hired in the last four years with no appreciable increase in efficiency or service has left many customers frustrated.

The necessity of power -- reliable, affordable, efficient power -- is undeniable, and the fact that in New Providence one cannot get reliable, affordable, efficient power is in 2016 a disgrace of epic proportions.

The fact that residents of New Providence have had the level of service they have had given the state of the plant, is nothing short of miraculous, some with knowledge of the situation have observed.

When the Christie administration embarked on its present course of modernizing the electricity plant, much was made of the idea of the ring-fencing of a legacy debt now approaching $500 million.

As a means of freeing the new utility company, BPL, from the Bahamas Electricity Corporation's (BEC) horrible balance sheet, there was to be a rate reduction bond that was to be used to pay off the legacy debt and to provide a steam of revenue for BPL to allow it to finance some of the investment needed.

The rate reduction bond, as with the publication of BPL's business plan, has become the subject of speculation only.

Deputy Prime Minister Philip Brave Davis, whose responsibilities include oversight of the electric utility, has said the business plan has not been published because Cabinet had internal disagreements over aspects of the plan.

The relationship of the legacy debt and the business plan to BPL's performance in the aftermath of Hurricane Matthew is simply this: BPL's CEO Pamela Hill intended to raise electricity rates. She intended to raise those rates in order to facilitate investment in infrastructure, equipment and personnel.

The decision by the Cabinet to veto that price hike has left BPL unable to finance any of the aspects of investment to which Hill would have referred.

This means no new trucks; this means no new engines. This means rather than investing in modernizing BPL's infrastructure, the utility has instead been left to contemplate cost-cutting efficiency measures to scrap together a response to a category four hurricane.

Once again, a political decision has debilitating national result.

The government and the U.S.-based PowerSecure signed a management services agreement in February, giving way for the official creation of BPL.

Michael Moss, former chairman of BEC, thinks it was a mistake not to privatize BEC outright.

"BEC ought to be sold. Let someone else have the headache to find the resources to bring it up to the standard that it needs to be right now," said Moss, who spoke to us on Saturday from Grand Bahama, where he observed Grand Bahama Power Company -- supported by its parent company Emera -- with a high visibility on the ground.

"It is the government's responsibility to find the resources. You have the management team saying we need a tariff increase, but that is being denied by the government.

"If BPL was privately owned, you go to the regulator, you make your case and they say yes or no. If you provide a justifiable cause [it is approved]. But we the taxpayers are going to foot the bill because we still own it."

Hurricane Matthew knocked out power across Grand Bahama, but Moss said he is pleased with the pace of the work in restoring power there.

Last week Sunday, a team of 35 workers from Tampa Electric Company (TECO), the parent company of energy and services firm Emera, arrived to assist with the restoration of power on Grand Bahama.

"The teams here have been fantastic," said Moss, who also previously served as general manager of Grand Bahama Power Company.

"In my opinion, I would say sometimes it almost seems a bit of an overkill based on the size of the place and the number of bodies on the ground... I have never seen anything like that.

"... I believe the restoration will proceed in a shorter time period than they predicted."

Visibility matters
Educated observers have likened the power grid in New Providence as one big spider web. This in itself has made it difficult to restore power supply in an orderly and efficient way.

"BPL is chaotic in my view," said Phenton Neymour, who was minister responsible for BEC under the Ingraham administration.

"I do believe that PowerSecure understands what is needed to make the repairs, but they do not have the resources nor the support from government.

"They were in such a poor position before the hurricane. I don't foresee them (fully) restoring power before a month. When they restore power, they will also have generation issues."

Neymour, who now lives in Grand Bahama, spoke to us from the island on Saturday as he observed numerous trucks and boots on the ground working to restore power to more areas.

He too said he was impressed by the restoration efforts there.

While one may question decisions made prior to BPL's assumption of responsibilities for the electrical utility, in the aftermath of Hurricane Matthew, it appeared that the hurricane plan that exists at the utility was not followed.

In addition to the many problems that saddle BPL, those who understand the inner workings of the electric utility concluded that coordination mistakes were made after the storm.

In the days after Matthew, BPL's visibility has been much lower than customers expected.

The Saturday after the storm, we drove around for several hours, mainly throughout southern communities in New Providence.
Over those three hours, we saw just one BPL work crew out. That crew was on Carmichael Road.

The poor visibility of work teams has been particularly distressing to the many residents whose patience is nearing its limit nearly two weeks after the hurricane.

Even Prime Minister Perry Christie, who has directly felt the pressure of BPL's obvious inefficiencies in the aftermath of the storm, expressed a bit of frustration.

"I have to accept [it] and sometimes I'm impatient with the rate of progress because you feel the pressure from people," Christie said on Friday.

"My secretary, for example, every morning I see her she [asks], 'Prime Minister, when are my lights coming on?'

"It's difficult."

While BPL's long-standing issues have no doubt contributed to the kind of response we are seeing in New Providence, it appears that certain managerial decisions made -- or not made -- before and after the hurricane have also contributed to what many customers see as a snail's pace response from the power company.

Speaking last week, Paul Maynard, head of the Bahamas Electrical Workers Union, said BPL "could have called out more staff and they didn't".

"That is an internal problem and that is going to be dealt with," Maynard said.

Leslie Miller, the former chairman of BEC, also said it appeared as if BPL was going about restoring New Providence's customers with a "skeleton crew".

"The hurricanes that we went through over the last four years, during our tenure, within two to three days things were back to normal," Miller said.

Hill defended BPL's response, saying it is unfair to compare BPL's response to BEC's response following previous storms.

"We have never, ever had something of this magnitude, so a comparison of this to other hurricanes or any other storms is really tough," Hill said.

"You're really in speculation mode when you do that, because you are comparing against something that has not happened before.

"In terms of us leveraging the resources, taking full advantage of the resources that we have, that has been priority one."

BPL claimed yesterday that it has restored power to 80 percent of residential customers in New Providence and said it was aiming to be "closer to full restoration by the end of the week".

Candia Dames, Guardian Managing Editor

Click here to read more at The Nassau Guardian

News date : 10/17/2016    Category : Business, Nassau Guardian Stories

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