The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The minister of tourism yesterday admitted that the frequent power outages are "very embarrassing" for the industry, and said: "Relief can't come soon enough."

Dionisio D'Aguilar told Tribune Business that the government is "striving every day" to fix Bahamas Power & Light's (BPL) woes, branding its inability to maintain a consistent, reliable energy supply as "a vexing problem for decades".

He was backed by Jeffrey Beckles, the Bahamas Chamber of Commerce and Employers Confederation's (BCCEC) chief executive, who told this newspaper that BPL's New Providence generation shortfall threatens to have "a crippling effect on business operations" right through until the Christmas/New Year period.

The new 132 megawatts (MW) of generation capacity from Wartsila is only likely to be installed, tested and come online by mid-December at earliest, and Mr Beckles said the private sector must suffer a "huge burden, an unfair burden" in "taking a hard look at how it plans for the next 18 months" due to the BPL crisis.

He added that the energy supply uncertainty had undermined confidence among both businesses and Bahamian consumers, and warned that it represented disincentive that threatened to deter both domestic and foreign direct investment (FDI) in this economy.

Mr D'Aguilar, acknowledging that "everyone is concerned about power", said: "We need to fix that problem, no doubt about it. The Government is striving every day. It's front and centre every day.

"Someone drawing analogies likened it to driving a 30 year-old car and making repairs to it all along the way, but now we've reached a situation where we have to invest in new generation and transmission and distribution.

"It's been a vexing problem for decades that we cannot deliver a reliable power supply. We're all waiting for the day when these [Wartsila] generators are snapped into action and alleviate the pain and suffering many Bahamians are undergoing every day."

Carlton Russell, the Bahamas Hotel and Tourism Association's (BHTA) president, last week called for "urgent relief" from the BPL crisis for the nation's largest industry despite most of its hotels possessing their own generators.

He explained that the frequency, and duration, of power outages were a nuisance that interrupted and disrupted the guest experience, leaving some with an unfavourable impression of The Bahamas. Mr Russell said Atlantis had seen a 50 percent increase in payouts to guests to compensate them for such inconveniences.

Mr D'Aguilar yesterday acknowledged the negative effects for tourism, including vacation rental visitors as well as hotel guests in the equation, given that many in the former category were staying in accommodation that did not have its own generator.

"The fact many involved in the hotel sector have to endure power outages is very embarrassing," the minister admitted. "The fact people have to suffer through power cuts does not bode well for the tourism sector.

"We understand we have to address and fix this problem. It can't come soon enough. It's a vexing problem and everyone is focused on trying to address it. I know the minister of works [Desmond Bannister] is having sleepless nights dealing with it, and I'm sure he's making progress. But relief can't come soon enough. I understand it's coming, but the quicker the better."

Mr Beckles, meanwhile, questioned what had happened to the hundreds of millions of dollars borrowed across successive administrations - and guaranteed by the Bahamian taxpayer - that has supposedly been used to invest in BPL's generation and transmission and distribution (T&D) infrastructure.

Arguing that accountability for BPL's current crisis should not be confined to the current management, Board and government, the Chamber chief executive - while praising the utility three-year turnaround strategy involving the Wartsila engines and Shell North America power plant - said there appeared precious little near-term relief for households and businesses.

"The short-term remediation leads us into December-early January, which means generation shortfalls are going to continue to have a crippling effect on business operations until that time, and that becomes one of the greatest challenges we face in the private sector," Mr Beckles told Tribune Business.

While encouraged by the arrival of Wartsila's new 132 MW generation capacity, he added that this by itself would not fully restore BPL's New Providence assets to full capacity and Bahamians had to hope they will perform better than the existing engine fleet.

Warning that "we're still in the risk frame as before", Mr Beckles said: "Businesses have to take a hard look at how they plan for the next 18 months. It's a huge burden, and an unfair burden, but it's the reality....

"Without a functioning, reliable energy source there's no chance of having a successful business. The idea of moving the economy; are we wasting our time talking about this? And if stable, reliable energy is non-available in The Bahamas, who will want to invest, both domestically and foreign?

"This has the potential of curbing spending by existing businesses because no doubt this has caused a lack of confidence. It's not a political statement; it's a fact of life. Confidence has taken a hit. People want to know what's happening with power. Households have the same issue. What do we do? What's next?"