THE Office of Utilities Regulations (OUR) is to partner with the National Contracts Commission to negotiate actively with four interested bidders for the building of a new power plant and present a recommendation to the Government in 30 days.
Minister of Science, Technology, Energy and Mining Phillip Paulwell, who made the announcement during his contribution to the 2013/14 Budget Debate at Gordon House in Kingston yesterday, said the OUR is to get additional powers of monitoring, evaluation and enforcement, similar to those it has over the telecommunications sector. “Legislation will be brought to Parliament during this year to amend the current Act,” he said.
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Minister of Science, Technology, Energy, and Mining Phillip Paulwell makes his contribution to the 2013/14 Budget Debate at Gordon House in Kingston, Turn to POWER on Page 4 yesterday. (PHOTO: LIONEL ROOKWOOD)
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In 2010, the OUR went to tender for 480 megawatts (MW) of generating capacity, and the Jamaica Public Service (JPS) was the sole bidder at the time and was awarded the right to construct a 360 MW combined cycle plant. It was contemplated that the Government
would be responsible for securing the supply LNG of fuel for the new plant, through the Liquefied Natural Gas project.
However, the OUR, on February 1 this year, informed the JPS and its shareholders that it had terminated the request for proposal (RFP) process in relation to the 360-MW project. The OUR said it ended the process after JPS missed a third deadline on January 30 to complete the requirements under the RFP for the 360-MW project and had requested a 30-day extension.
The JPS said the project scope changed significantly since 2011, when it was granted approval to proceed with construction of the plant saying its role initially was simply to construct the plant, but late last year the company was asked to take on the additional responsibility of identifying a supplier and managing the process of procuring the LNG.
A subsequent decision by the OUR to accept unsolicited proposals from the JPS and other companies, this year,
saw five entities presenting unsolicited proposals for 14 discrete projects.
Yesterday, Paulwell said this development was “a big turnaround from 2010, when there was a sole bidder, signifying confidence in this administration, its policies and regulatory framework”.
He said that following evaluations by international consultants Mott McDonald, which contemplated among other factors the firmness of the proposal, the overall price and expected impact on retail electricity rates of the 14 projects submitted, four were rejected because the information was incomplete.
The energy minister said, although 10 were screened for detailed technical and comparative economic analysis, of the 10, the OUR determined that three entities made the pitch. Those include Amorview/Tankweld, which presented a
232-MW project proposed for Old Harbour and a 122.4-MW project proposed for Caymanas; JPS, which presented proposals for a 323-MW and a 350-MW combined cycle plant, both proposed for Old Harbour; and Azurest/ Cambridge, which presented a proposal for a 388-MW plant mounted on a barge.
Paulwell said all three proposed the use of natural gas.
In the meantime, he said subsequent to the OUR receiving and assessing those proposals, the Government has since received another unsolicited proposal from a Hong Kong company, proposing to build an LNG receiving terminal and power plant and to supply LNG from its own gas fields. That company has proposed a combined cycle gas-fired 360-MW power plant adjacent to the LNG hub terminal.
“After several stops and starts, today I can speak with certainty that a positive change is about to come to the supply of electricity in Jamaica. It is essential that we begin construction of new generating capacity this year; there have been too many delays, and we can no longer live with these high electricity prices,” Paulwell told the House.
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