This venture over a 10-year, re-financing period would save the Bahamas Electricity Corporation (BEC) over $50 million dollars, Mr. Roberts stated during the signing ceremony at corporation Friday.
“Re-financing this loan was originally facilitated by the Inter- American Development Bank with local banks, will also eliminate the foreign currency and exchange exposure risk involved with the IDB basket of currencies,” Mr. Roberts stated.
He noted that the move was a strategic mechanism that BEC’s Board of Directors led by Al Jarett and BEC’s management “used to propel the corporation’s ability to pass on significant savings, to you, its customers in New Providence and Paradise Island and the 28 supply areas throughout the Family Islands.”
Mr. Roberts thanked the representatives of the IDB and commended executives from Scotiabank (Bahamas) Ltd; Royal Bank of Canada Ltd, First Caribbean International Bank (Bahamas) Ltd, Citibank N A Global Corporate & Investment Bank, and Bank of The Bahamas International Ltd for demonstrating their faith in the corporation by facilitating this loan, in varying amounts.
“It is not everyday that BEC or any corporation for that matter applies sound financial expertise and business acumen to obtain a loan facility for $128 million that will save the people of The Bahamas at least $5 million a year. And when you consider what it took to achieve this, one wonders why the previous administration did not put the people of The Bahamas first and do this a long time ago,” he stated.
Mr. Roberts said that the move demonstrated that the new government carefully placed the best persons of their employ in their expertise to make a difference in the lives of Bahamian foreign investors and visitors alike.
In the past 18 months, he said that BEC had undergone a massive transformation with the appointment of Mr. Jarett, a distinguished banker to the position of Chairman of BEC’s Board of Directors.
“Over the latter 12 months, BEC’s board and management improved cost efficiencies in the following ways:
1. Negotiation of a new fuel oil supply contract that saved the corporation at least $4 million a year on fuel cost;
2. The commissioning of two new plants – a 23 MW Gas Turbine at Blue Hills and a Slow Speed 30 MW Diesel Engine at Clifton Pier has resulted in improvement in fuel operating efficiencies with projected savings of $18 million; and,
3. BEC will save an additional $1.2 million from the signing of a new fuel tank lease agreement with suppliers.
At last Wednesday’s commissioning of another 23 MW Gas Turbine at the Blue Hills Power Station, Mr. Roberts said the unit was fully operational and he was advised that it would improve system reliability.
“This gas turbine alone represents additional savings in fuel costs of some $6.0 million,” he said.
Additionally the minister said, “BEC signed another contract with Sumitomo to install boilers to facilitate the operation of a combined-cycle generator that will produce 50 per cent more electricity without burning any additional fuel.” The manufacturer financing will yield savings for customers at interest rates between 2 1/2 to 3 per cent.
“BEC must also resolve the problems of interrupted power supply and is mandated to minimise complete system shut downs and shorten system restoration time,” Mr. Roberts said.
While this may sound like a daunting task given the nature of the vulnerability of overhead lines during inclement weather, I am confident that soon, BEC will be setting the standard for utility corporations in the region while finding increasingly innovative ways to bring quality and savings to all of its customers,” Mr. Roberts stated.
By Jimenita Swain, The Nassau Guardian
