The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE BAHAMAS Electricity Corporation’s (BEC) executive chairman yesterday slammed his own government’s energy reform process, saying there was “absolutely no need” to split the monpoly provider into two .

Speaking at the Bahamas Society of Engineers’ (BSE) monthly luncheon, Leslie Miller said he was also opposed to allowing a foreign entity to take majority control of BEC, as happened with the Bahamas Telecommunication Company (BTC) when Cable & Wireless Communications bought a 51 per cent stake in 2011.

“BEC is a small entity, and BEC’s major market is New Providence. BEC subsidises all the Family Islands,” Mr Miler said. “Abaco and Exuma are the only two islands that have a lot of economic activity going on, but BEC carries the load for all of the Family Islands.

“There is no need to cut BEC the way they are doing it. I don’t agree with it. In most countries where that took place, in small economies, it did not work, and it will not work in my humble opinion. My view is there is absolutely no need to split BEC in two. The country isn’t broad enough.”

The Government last year announced that it planned to create two new entities into which BEC’s assets, liabilities and operations will be transferred.

The first is a new transmission and distribution company (NewCo), which will be wholly-owned by the Government. This company will be responsible for the operation, maintenance, repair and expansion of NewCo’s electricity transmission and distribution systems, and for billing, collection and customer services.

Under the BEC tender process now underway, the Government is seeking a management partner for NewCo. But just one of the five remaining bidders, Caolinas-based Power Secure, is focused on this area.

The second BEC entity will be a new generation services company, responsible for the operation, maintenance, repair and financing of BEC’s current electricity generation facilities, as well as the development of new power generation plant.

This entity will enter into a Power Purchase Agreement with NewCo, and the Government will give the winning generation bidder an equity stake in the business, although the size of this will have to be determined in subsequent negotiations.

Among the four remaining generation bidders is Caribbean Power Partners, the group formed by Texan Taylor Cheek. Also in the running are believed to be Genting and Cayman Islands-based Inter-Energy.

All five bidders are now believed to have had meetings with the Cabinet committee overseeing the BEC reform process, with some groups now in the process of answering further questions and submitting more information. The Government will likely have to choose the preferred bidder(s) by early March.

However, Mr Miller remins distinctly unimpressed, despite BEC’s dire financial straits and clear need for outside financial, management and technical expertise.

“I believe in Bahamianisation, and I believe that the Government, whatever it does, should ensure that BEC is to be managed by the people of the Bahamas,” Mr Miller said.

“That is my personal belief and I will fight for that with all that is in me, so that what took place at BTC does not take place at BEC. Some will disagree with me, but I couldn’t care less. My personal view is that I don’t think we should allow any foreign entity to be in charge of such a vital entity in our country.”

He added: “We have a long way to go, I believe, in turning BEC around. BEC was, and still could be, a very profitable organisation if it is reconstituted properly, if changes that are necessary are allowed to take place, and if you have a joint venture with a Bahamian parter.

“I have no interest whatsoever in what is going on with regard to having another foreign entity come into the Bahamas, as was the case with BTC, turn it around quickly, rake in the profits, send it back to their domicile, and the Bahamian people, in my opinion, are left with a product that is not up to pa.”

Mr Miller said all the groups making proposals in the BEC process were doing so on the basis that they would build a new plant at Clifton and sell BEC electricity.

He added that BEC had been producing electricity for 50 years.