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Tag: Kelly Tomblin

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Electricity JPS LNG

JPS Closing Negotiations With Alternate Bidder For 190mW Project

December 18, 2015

The Jamaica Public Service Company Ltd (JPS) has made good on its pledge to activate alternative plans to ensure the execution of the proposed 190-megawatt power plant at Old Harbour in St Catherine.

Yesterday, the light and power company said it was now in the final stages of negotiations with an alternate bidder to provide engineering, procurement and construction services, for the plant to be built in Old Harbour, St Catherine.

The original preferred bidder, Abengoa, was selected through a competitive tender process, with the assistance of two international consulting firms, AMEC Foster Wheeler and Power Engineers Collaborative LLC.

In November, the Spanish firm filed for protection from creditors – a possible first step towards filing for bankruptcy.

With the announcement of Abengoa’s financial challenges, JPS has been closely watching the progress of the Spanish company’s financial-restructuring plan.

However, Abengoa has not been able to provide the financial assurances required as a normal part of the process of confirming a bidder.

Kelly Tomblin, JPS president and chief executive officer, said: “We are very close to concluding key terms with one of our alternate bidders. Throughout this time, we have been working closely with the Electricity Sector Enterprise Team (ESET), so they are embedded in the process.”

Commenting on the importance of the project to Jamaica, Tomblin said: “We want to make it very clear that this project is not, and has never been, in danger. JPS shareholders (EWP and Marubeni) are the ones who have committed to bringing equity to the project, and there is keen interest and indicative commitment from a variety of financing sources. I want to make it very clear that the bidder on this project is not the financier. They are an engineering, procurement and construction firm, who will be subject to significant oversight and potential penalties for non-performance. We need to clear up any confusion on their role.”

The Gleaner

Electricity JPS LNG News Oil

With question mark over Abengoa…

November 27, 2015

JPS to open discussions with other renewable vendors

The Jamaica Public Service (JPS) yesterday announced that it will be engaging in discussions with other renewable vendors to ensure execution of the planned energy 190 MW Power Plant in Old Harbour, St. Catherine.

Chief Executive Officer, Kelly Tomblin in a press release advised the public that Spanish renewable energy and engineering firm Abengoa has filed for protection from creditors – an initial step towards filing for bankruptcy. The company was recently announced as the preferred bidder to construct the combined-cycle plant in Old Harbour.

“While JPS notes the development with regret, it is fully prepared to activate its alternative plans to ensure the execution of the project, which will replace the present Old Harbour Bay Power Station, while adding more Liquefied Natural Gas to the country’s energy mix,” Tomblin stated.

“We will be having dialogue with Abengoa — but JPS remains undaunted by the news. As a responsible corporate entity, our company has been in full preparation mode for any type of challenge regarding the completion of this project. We will not be derailed from our mission to bring real change to the energy sector and by extension, to Jamaica,” she continued.

The CEO reportedly stated that JPS has been eyeing other vendors since the announcement of the Abengoa’s financial situation.

Abengoa, which reported debt of ¤8.9-billion in its third quarter financials, began bankruptcy protection proceedings to avoid what could be one of Spain’s largest insolvencies.

The figure could be doubled when including ¤2.1 billion in funds it owed to suppliers and ¤5.9 billion of debt the company has in subsidiaries it said could potentially be sold. According to reports, the company has filed for protection from creditors with hopes of reaching a deal on its debts by March.

According to Tomblin, Abengoa was selected based on its wide ranging and impressive technical expertise. The company has been touted as one of the world’s top builders of power lines transporting energy across Latin America and a top engineering and construction business, making massive renewable-energy power plant.

The light and power company also had the understanding that Abengoa’s financiers were committed to the company for the long term.

“JPS wishes to assure its customers and all stakeholders that the 190 MW project remains on track for the plant’s commissioning in 2018.The Company will keep stakeholders informed as events unfold,” she said.

Jamaica Observer

Alternative Energy Electricity Energy Saving JPS News

Pot Can’t Call The Kettle Black, JPS Says It Won’t Jump The Gun On Abengoa Bankruptcy Proceedings

November 26, 2015

 

Although Abengoa, the Spanish company selected as the preferred bidder to build a major power plant in Jamaica, has initiated steps that could lead to a bankruptcy declaration, Jamaica Public Service Company CEO Kelly Tomblin is not yet ready to call it quits on the multinational corporation.

Reacting to news of the bankruptcy proceedings initiated by Abengoa, Tomblin said she was monitoring the situation of the Spanish renewable-energy company.

It was only last week that JPS announced Abengoa as the preferred bidder to build the 190-megawatt combined-cycle plant in Old Harbour, St Catherine.

Despite fears that Abengoa may not be able to fulfil the requirements of the bid, given its precarious financial situation, Tomblin is holding out hope that the company will be able to make good on its financial obligations in relation to the bid.

“We have been monitoring the situation for some time. We have backup plans, but we have to wait and see what Abengoa shows us. But pot can’t call kettle black because JPS, as you know, has had its own financial difficulties, and we are just now emerging from those, so we know what it’s like, so we want to make sure that we don’t overreact,” Tomblin told The Gleaner last evening.

In the event that Abengoa folds completely, Kelly Tomblin pointed out that JPS has several alternatives.

“There are other vendors. We have many vendors who were poised to build the plant, so if, in fact, Abengoa can’t show, then other people can build the power plant. As you know, we have shareholders who have deep expertise, but we don’t want to jump the gun. Of course, Abengoa will have to give us financial assurance, but, again, pot can’t call the kettle black. It wasn’t very long ago that JPS, too, was facing insolvency problems,” she said.

Energy Minister Phillip Paulwell, in reacting to the news, said there was no need to panic and that JPS should be given the space to continue the procurement process.

When asked if the situation vindicates him in respect of the Energy World International (EWI) bid, Paulwell said, “There will be vindication when the gas is here because that, for me, is the most important aspect.”

Paulwell was in charge of overseeing the Government’s 391-megawatt project, which awarded a bid to EWI, a company which faced financial woes, leading to questions about its ability to deliver on the bid. This was before responsibility for the project was handed over to the Vin Lawrence-led enterprise team.

Now, with news of Abengoa’s bankruptcy filing, Jamaica’s renewable-energy plans may be delayed yet again.

Abengoa’s latest financial woes sent shockwaves through the banking sector and financial markets in Spain yesterday, fuelling concerns that the country’s lenders may be left with heavy losses.

According to international media reports, Abengoa has been having financial challenges from as far back as 2013, when Spain instituted energy reforms, which reduced subsidies to renewable-energy providers. This affected Abengoa’s capital base significantly and further exacerbated its pile-up of debt.

The Financial Times has said that a possible default by Abengoa could count as the largest bankruptcy in Spanish history, given that as of September, Abengoa carried gross debt of £8.9 billion.

The filing for preliminary creditor protection yesterday came after a potential investor cancelled plans to inject £350 million into the company.

While he could not comment on questions of whether due diligence was done on the Abengoa bid, Private Sector Organisation of Jamaica CEO Dennis Chung said news of the filing does not mean the company will go under, as bankruptcy proceedings often give a company an opportunity to rebuild.

“I couldn’t comment on due diligence. I have to believe that proper due diligence would have been done, so that question should be put to the person who actually did the due diligence,” Chung said.

 

The Gleaner

Electricity Government News

Full Speed Ahead – JPS Shrugs Off OUR Shocker, Given Green Light To Build Power Plant

February 6, 2015

Despite recent hurdles, the Kelly Tomblin-led Jamaica Public Service (JPS) is indicating that it is determined to increase its contribution to the burdened national grid and help stave off threats of power outages in the years ahead.

The light and power company has shrugged off the shock of the Office of Utilities Regulation’s (OUR) disapproval of its request for a rate hike and is moving ahead with plans to erect a 190-megawatt (MW) power plant.

Shedding light on the work of the Electricity Sector Enterprise Team (ESET), chairman Dr Vincent Lawrence told journalists yesterday that his group has its eyes firmly set on the addition of 380MW to the national grid by 2017.

Addressing a press conference at the Office of the Prime Minister, Lawrence revealed that Cabinet on Monday approved the construction of the 190MW power plant along with two others to increase generating capacity to the island by 380MW.

“The JPS has exercised its right of first refusal to replace obsolete generating capacity by the construction and installation of a 190MW gas-fired, co-generation power plant at Old Harbour,” said Lawrence.

He said the JPS had agreed to a power tariff of not more than US12.89 cents to facilitate the construction.

“ESET has recommended and Cabinet has given approval for a letter to the JPS authorising the development of 190MW of generating capacity and the construction of a terminal in Old Harbour,” said Lawrence.

He disclosed that Cabinet also approved the construction of a 140MW gas-fired, co-generation plant by Alpart Venture and another 50MW for Jamalco Venture.

Presenting an update to journalists during a press conference after the submissions were made to Cabinet yesterday, Lawrence said the JPS would also be forging ahead with the upgrading of its Bogue plant, which generates 50MW, which is not factored into the added generating capacity.

For Bogue, Lawrence said the proposal is to convert the feed stock to gas, making the retrofitted power plant a 115MW gas turbine co-generation power plant.

US$15 MILLION REQUIREMENT

Lawrence pointed out that the JPS requires capital expenditure of US$15 million for the conversion of the Bogue power plant to be completed by the end of 2015.

He disclosed that ESET had been forced to delay its due diligence on the Jamalco project because the new majority partner, the Noble Group, is finalising its own analysis of the project in order to decide whether it will be making amendments.

Lawrence said Cabinet also agreed with ESET to subject the existing co-generation proposal on the 50MW of coal-fired generation at Jamalco to further analysis before it provides more definite recommendations on the project.

The new principals of Jamalco have promised that their position will be forthcoming by the end of the month.

Lawrence said ESET has continued with a number of stakeholder consultation meetings and discussions with key players in the electricity market.

These comprise the JPS; the OUR; the bauxite alumina sector (Jamalco and Alpart); the Ministry of Science, Technology, Energy, and Mining; the Inter-American Development Bank; and Independent Power Producers (IPPS).

Lawrence said ESET continued to receive assistance from the World Bank, which has provided expertise in analysing technical and financial submissions from JPS, Alpart, and Jamalco, which are planning to build, own, and operate the proposed power plants.

He said ESET had also conducted assessments of the gas market, including trends, costs, shipping size, among other variables, and has conducted comparative studies of electricity policy and framework across the region.

Among other recommendations approved by Cabinet are the review of the Amended and Restated All-Island Electricity Licence (2014), with the goal of facilitating viability, reliability, and investment in the electricity sector.

gary.spaulding@gleanerjm.com

Jamaica Gleaner

Alternative Energy JPS News

JPS, ATL partner on energy-saving retail products

May 22, 2013

THE Jamaica Public Service (JPS) and appliance giants Appliance Traders Limited (ATL) have partnered to provide energy-saving products and services to customers.

The partnership, which was sealed in a Memorandum of Understanding yesterday, will see ATL extending its distribution of alternative and energy-efficient products through the JPS’s eStore.

ATL Group CEO and Deputy Chairman Adam Stewart presents President and CEO of the JPS Kelly Tomblin with a bag of goodies at the signing ceremony yesterday. (PHOTO: ASTON SPAULDING)

JPS customers will also benefit from a wider range of cost-cutting products as well as technical and consultative services through ATL’s Energy Solutions arm.

“I think it demonstrates a genuine intent by JPS to want to show Jamaicans how to reduce their energy bill,” group CEO Adam Stewart said, describing the move as “uncharacteristic” of a power company.

The leadership of this company (JPS) has made it clear that they want their consumers’ bills to go down, Stewart reasoned, noting the similarities in both companies mandate to promote energy conservation and efficiency.

For JPS chief executive officer, Kelly Tomblin, “this is an example of two companies coming together and saying we can provide help and not in three years, but today.”

She said though the planned construction of the 360 megawatt (MV) plant will aid the reduction of the nation’s energy woes, “educating and empowering customers to responsibly manage their energy use today will go a far way to solving the country’s energy challenges.

“We can understand the insanity of a company who wants to sell products to its clients that will ultimately drive down our sales, and people ask me if I’m crazy,” the JPS head said.

She noted, however, that her 25 years in the energy sector had inspired her conclusion that “if we do the right thing, if we train people the right way, economic development happens (and) the world grows.”

While noting the susceptibility of the JPS to shifts in the economy, Tomblin said the company hoped the partnership would be viewed as “our next step in redefining who we want to be in our hearts and in our delivery”.

ATL made its expansion into the alternative energy business with the launch of its Energy Solutions store earlier this year.

“Record energy prices in Jamaica as well as in the international marketplace have heightened the need for sustainable alternatives,” ATL’s energy and engineering manager, Paul Grey said.

An expansion into the energy business was therefore a “natural progression” for the company, Grey reckoned.

“We are at a transformational period in the Jamaican energy sector that requires us to either heavily curb our existing consumption patterns or look to alternative sources of power,” he suggested.

For Stewart, “What we find is that the average consumer doesn’t understand the appliances in their homes that consume the most power.

“So what we find lacking is the key words

Electricity JPS News

Kelly Speaks Her Mind … Urges Speedy Decision On New Power Supplier

May 20, 2013

Kelly Tomblin
Kelly Tomblin

Arthur Hall, Senior News Editor

The Jamaica Public Service Company (JPS) is imploring the government to speedily make a decision on which entity will be given the job of supplying the country with 360 megawatts (MW) of power to replace the aged and inefficient generating plants now operating.

The company is one of four bidders for the right to supply the electricity based on a request for proposals issued by the Office of Utilities Regulation (OUR).

The OUR is expected to make its selection and recommendation to the Cabinet within the next 30 days.

Move now

But even as the OUR continues its deliberations and seek clarifications from bidders, JPS President and CEO Kelly Tomblin is urging the State to move now to get the ball rolling.

“At this point we are desperate for lower energy prices, and if we (JPS) are not going to be the entity that builds it, let somebody else build it,” Tomblin told

Electricity Government JPS News

EDITORIAL – It’s More Than Electricity Theft

May 13, 2013

Kelly Tomblin, CEO of the Jamaica Public Service (JPS) Company, may have been bit a melodramatic. For thieving electricity consumers, as draining as they are on the company, and as difficult as they make her life, mask the larger problem faced by the light and power provider – and Jamaica.

For electricity theft in Jamaica is symptomatic of more fundamental issues, among which are the Government’s failure to advance and implement a clear energy policy; its ‘outsourcing’ of elements of its social welfare programmes; and the JPS’s own failure, over a long time, to adequately invest in the technologies to allow it to operate as efficiently as possible in a market it says it wants to be in. Which, of course, doesn’t derogate from the facts presented, or the logic of the argument advanced by Ms Tomblin last Friday.

JPS’s inability to adhere to agreed debt-to-earnings ratios potentially imperils its relationship with its lenders and could, as their auditors pointed out in their review of its 2012 accounts, present a risk to the company “as a going concern”.

Reducing the 14 per cent of electricity that is stolen would be an inherently good thing. It would enhance the viability of the power company, as well as ease the burden on those consumers who now pay.

But there is another pertinent matter which the Government and the JPS must address squarely. The estimated US$30 million, or nearly J$3 billion, lost to the thieves is a sum inflated by policy failures and inefficiencies. Faced with this fact, a serious government would end the dithering over what fuel is to be used to generate electricity, as well as conclude the becalmed bids for new power plants. Nothing, though, gives us confidence that this will be the case.

Cheaper fuel is essential

The fact, however, is that the electricity produced from expensive oil at US 41 cents per kWh is unviable for Jamaican firms and domestic consumers. Cheaper fuels and modern power plants are essential. Procrastination by the Government in giving policy directives on the former, and JPS’s failure to act on the latter when that was in its purview, helped to create today’s crisis.

Further, Jamaica’s perennially weak economy, with its high rates of joblessness and underemployment, means that electricity, at its real cost, is beyond the effective demand of many consumers, who nonetheless have expectations of it. So, they steal it and have, in the process, been enabled by the Government, as was all but admitted by Roger Clarke, the agriculture minister, in relation to whole communities on sugar estates that were allowed to tap into government entities for their electricity.

This is, at once, reflective of a kind of blind-eye social welfare and a breakdown of law and order. Theft becomes normal. Attempts to break the cycle often erupt in violence.

It is obvious that Jamaica must get on with the policies and projects that will lower electricity tariffs. The Government, too, must have the will to address the thievery.

It is also in the JPS’s interest to invest in the smart technologies that make the stealing of the product difficult.

These are the kinds of things that firms sometimes have to do to survive in a market. And sometimes are made to do as monopolies in regulated markets.

The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.

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