GPL gets $18B to procure fuel

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The Guyana Power and Light (GPL) Garden of Eden Power Station

 

 

 

 

 

Some $18 billion has been approved for the procurement of 2.4 million barrels of fuel for the Guyana Power and Light (GPL) company in 2025.

According to Prime Minister Brigadier (Ret’d) Mark Phillips, the approval comes in light of growing energy demands and a global surge in fuel prices, which have placed additional pressure on the utility provider.

“At the current fuel price of approximately US$104 a barrel, GPL can procure 1,657,371 barrels of the fuel at the current customer tariff without any increase in customer rates. However, GPL needs 2,462,380 barrels of fuel to meet its generation requirements. GPL needs funding to procure, therefore, an additional 805,009 barrels of fuel at approximately US$104 per barrel. This equates to $18 billion. With the exchange rate being $215,” PM revealed.

The Prime Minister disaggregated the sum during the consideration of the budget estimates on Monday.

This allocation, while necessary for the operation of GPL, raises the question of how sustainable these costs are in the long run, especially considering that the break-even cost for GPL is $70 per barrel, with the current tariff structure falling short by US$34 per barrel.

Nevertheless, PM Phillips emphasised that, despite these financial challenges, it has not increased the electricity rates for households or businesses since assuming office in August 2020.

“We have not increased the rate of electricity for the household and for any of the consumers from the time we have taken office. Notwithstanding the shocks that would have seen fuel prices going through the roof on many occasions and other issues suffered by GPL, our people today, January 2025, is paying the same rate that they were paying for electricity pre-COVID in Guyana. The point is, you have a Government that did not increase the electricity rate in five years,” he added.

 

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