The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamas Power & Light (BPL) is moving to obtain full environmental clearance for an up to $100m investment in new generation plant at Clifton Pier that is designed to improve energy efficiency and reliability.

The Environmental Impact Assessment (EIA) for a project billed as creating between 150-200 construction jobs has been released ahead of an October 12 virtual public consultation being organised by the Department of Environmental Planning and Protection (DEPP).

Previous public consultation responses have suggested the new plant, known as ‘Station D’, will be financed from the proceeds of BPL’s proposed $535m rate reduction bond (RRB) that has yet to be placed. Whether the bond will actually be issued remains to be seen, as that decision now rests with the Davis administration, but BPL executives have said “other financing options will then be considered” if the $535m is not raised.

Amendments to the bond legislation need to be passed by Parliament before BPL’s mammoth refinancing can take place, which will likely push the exercise into next year. Construction on ‘Station D’ is supposed to take 14 months once all necessary permits are obtained, and it will provide between 82-108 Mega Watts (MW) of energy via six generators capable of using natural gas, heavy fuel oil (HFO) or automated diesel oil (ADO).

Together with Clifton Pier’s ‘Station A’, the new plant will combine to provide between 200-220 MW of New Providence’s baseload generation. However, the EIA is confusing over Shell North America’s role when it comes to a power plant that the multinational energy giant was supposed to design, build and operate itself, then supply energy to BPL under a power purchase agreement (PPA).

‘Station D’ will be constructed, operated and maintained by Finnish energy giant, Wartsila, with Shell seemingly just involved in supplying the plant’s liquefied natural gas (LNG) fuel from a nearby regasification plant that will also be built at Clifton Pier.

“If the proposed LNG terminal and regasification facilities receive regulatory approval and are constructed, then the current plans call for natural gas to eventually replace HFO and/or diesel as the primary fuel,” the EIA said.

“The engines for the proposed Station D project are the most efficient of their size and technology that are currently available, with a thermal efficiency of 44 percent on natural gas and emissions that meet World Bank requirements...

“BPL will develop the power plant, and Shell will develop the LNG plant. BPL will contract Wärtsilä as the contractor for Station D. Upon completion of the new power plant, Wärtsilä will operate and maintain the plant via an operation and maintenance agreement using a fully trained Bahamian workforce.

However, the EIA states elsewhere that Shell will have “joint ownership” with BPL and an unnamed group of Bahamian investors. It added: “The power plant component of the project and associated relevant infrastructure will be developed by BPL and the LNG regasification infrastructure, and a multi-fuel jetty will be developed by Shell Gas and Power Developments B.V. or affiliates (Shell).

“The commercial structure of the LNG to Power project, subject to ongoing negotiations, anticipates that the facility will be jointly owned by Shell, BPL and a consortium of local investors.”