Vice President, Dr. Bharrat Jagdeo has revealed Brazil’s profound interest in supporting the realization of Guyana’s prestigious Amaila Falls Hydropower Project (AFHP), a flagship initiative under the esteemed Low Carbon Development Strategy (LCDS) 2030.
During his recent press conference, the Vice President unveiled that the remarkable 165-megawatt hydropower project has attracted not only Brazil but also numerous other countries with compelling proposals. Anticipating an upcoming bidding process, Jagdeo underscored Brazil’s unwavering enthusiasm, affirming, “The Brazilians are still very interested in this regard too.” The government has received at least two proposals from reputable Brazilian companies and has also garnered interest from entities based in the United States.
The AFHP, conceived to advance Guyana’s sustainable energy objectives by reducing reliance on fossil fuels and promoting clean energy generation, initially took shape during the tenure of the People’s Progressive Party (PPP) administration. Regrettably, it encountered formidable challenges that led to its suspension during the subsequent coalition administration’s term, which assumed power in 2016.
Originally slated to operate under a Build-Own-Operate-Transfer (BOOT) model, the project witnessed the China Railway Group Limited securing the contract for its execution in 2012. China Railway was tasked with supplying electricity to the esteemed Guyana Power and Light (GPL) Inc. at a predetermined cost per kilowatt-hour (kWh) while assuming the equity requirements and associated risks throughout the project’s lifecycle.
However, the project encountered significant setbacks when China Railway faced difficulties in meeting these obligations. It then pushed for alternative arrangement in the form of an Engineering, Procurement, and Construction (EPC) contract. The government which is staunchly adhered to the BOOT model, declined the alternative proposal, thereby exacerbating the already challenging financial hurdles faced by China Railway.
Following their return to office in 2020, the PPP government embarked on reviving the project, outlining in their manifesto an unwavering commitment to the BOOT model. Accordingly, the selected company will be responsible for supplying electricity to GPL Inc. at a price not exceeding US$0.07737 per kWh, while assuming full equity and all associated risks.
In conjunction with discussions surrounding the Amaila Falls project, Vice President Jagdeo emphasized ongoing dialogues pertaining to the integration of Guyana and Brazil’s economies, with particular emphasis on Northern Brazil and Guyana. Acknowledging the unwavering support of the state of Roraima in fostering economic integration, Jagdeo stressed the imperative for federal-level involvement and support from the Brazilian government.
Notably he said, the proximity between the two regions offers enticing prospects for bolstered trade relations, agricultural synergies, and streamlined exchanges.