An international energy and infrastructure company has proposed a floating power plant solution to government that could revolutionize how this country generates its power. SGI Global Holdings Ltd, along with a Rwandan-based investment firm, are courting the Bahamian cabinet with "power barges" designed to sit in protected inland waters around New Providence. Executives have drafted a proposal that claims to slash the average cost of electricity while also making financial contributions to Bahamas Electricity Corporation (BEC).
According to a presentation by SGI Global Holdings, the alternative source of power would reduce the average current pricing of $0.40 cents per kilowatt hour (kWh) to $0.28 cents/kWH in the first year. By year seven, the international firm claims it will reduce the cost of electricity to $0.25 cents/kWh. The proposal before Cabinet is to construct two 136 megawatt power barges that are 80 feet wide and 200 feet long. Each barge can carry 3,520,000 litters of fuel storage, and while a low sulphur diesel is being initially considered, SGI Global Holdings said the plan "will evolve into a sustainable model which will have the ability to operate with many kinds of fuels"
. "We propose funding the costs of the power barges (estimated at $100 million to $150 million) and raising an additional $50 million of capital to fund improvements to the BEC power grid," the presentation stated. The government would assumably enter into a power-purchase agreement with the company. SGI's offer to handle the up-front capital costs would alleviate any financial burden from an already cash-strapped government. Meanwhile, helping to fix BEC's crumbling infrastructure is perhaps another major win for the Christie administration.
The company said it would continue to work with BEC to upgrade the grid, including upgrading transmission and distribution lines, replacing aging equipment and increasing interconnection among the many small generators and population centers. The presentation also makes reference to a "smart grid program" that would bolster efficiency and reliability. Leslie Miller, the chairman of BEC, recently stated in the House of Assembly that the public corporation is posed to lose around $50 million this fiscal year. Reducing major losses at public corporations is indeed central to the Ministry of Finance's mandate to reduce the country's spiraling debt. A shift to alternative forms of fuel has long been on the radar of successive governments.
This latest proposal calls for a modular, compact and highly efficient bio-fuel plant design. A series of "trains" can be added to the original power barge for greater capacity. Compressed natural gas (CNG) is also being considered for these installations. Executives stated that Bahamian energy consumption is not at a level to justify the cost of liquefied natural gas (LNG). "CNG is a fossil fuel substitute for gasoline, diesel fuel or propane/LPG. Although its combustion does produce greenhouse gases, it is a more environmentally clean alternative to those fuels, and it is much safer than other fuels in the event of a spill," the presentation stated.
SGI said it holds an environmental partnership with the Center of Toxicology and Environmental Health (CETH), a science-based consulting firm established to provide toxicology and human health consulting services to the public and private sector. The project meets compliance standards under U.S. environmental regulations, according to the presentation, and has recently completed a full environmental review. For the purposes of financing, another key partnership is with Ngali Holdings, an African-based firm specializing in infrastructure projects.
"We focus on equity investments from $5 million to $100 million, with a minimum investment of $2 million. We have varying investment structures with varying levels of ownership, that change based upon the nature and individual conditions of the project," the presentation stated. "We also seek debt investments which will age from zero to 70 percent of each of our projects, depending on the particular capital structure and conditions required for deployment.
Typical debt placements range from $10 million to $1 billion." According to the proposal, Ngali Holdings' partners include various departments at the government of Rwanda. Companies in Kenya, Tanzania, the Democratic Republic of Congo and Nigeria are also listed a partners, along with western entities in the U.S., UK, Italy and Switzerland.
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