EDITORIAL - Paulwell, Charvis must quit

We won't insist that Phillip Paulwell act on his solemn pledge that the Office of Utilities Regulation (OUR) would miss another deadline for a decision on new electricity-generating capacity only "over my dead body".

We would, however, accept Mr Paulwell's resignation, as well as that of the OUR's director general, Maurice Charvis. Decency would demand nothing less from either man. For their management of this issue has been, to put it mildly, incompetent. Some people might infer something far worse.

The fact is that at more than US$0.42 per kilowatt-hour, electricity in Jamaica is not only expensive, but a significant hindrance to the competitiveness and development of the island's economy.

There are two primary factors that influence the high price of energy: the power plants of the major generator and monopoly distributor of electricity are mostly old and inefficient. And their inefficiency is exacerbated by the fact that they are fired by expensive oil.

For more than a decade, Jamaica procrastinated over the mix of fuels to which it should transition and the plants that would most efficiently burn these fuels. The authorities eventually came down on the side of natural gas.

perpetual delays

But since then, they have hardly got anything else right. A request for proposals was made, bids were submitted, and preferred bidders identified, only for the process to be abrogated because it was deemed to have been compromised.

The latest effort, a request for 360 megawatts, has itself been through several iterations, the result, primarily, of bungling by the OUR and interventions by Mr Paulwell's energy ministry to accommodate other bidders. But we should have been advised today who was the preferred bidder from the entities which, last month, presented five proposals.

Now, that has been put back by a week, to allow, according to the OUR, for clarification from "some bidders" of "critical matters". There are also unforeseen "legal issues".

A week may not seem significant. However, it raises important questions about the sanctity of the bid process, including the time within which bidders are allowed to formulate their proposals.

Further, there is an absence of transparency over the legal and other issues that are now to be clarified, questions as to why this was not done during the evaluation of bids, and whether this accommodation provides an unfair advantage to any party.

justifiable suspicion

The bungling in this bid process is, of itself, sufficient to call to question the competence of the OUR and to have the agency's boss and the loquacious Mr Paulwell held to account. But there is more.

The OUR has also delayed its decision, from this week to month end, on its request for bids on 115 megawatts of alternative energy. That is because of, the OUR says, the large number of bids it received, the size of the bid documents, and the number of questions it has about the bids.

This is no way to do business. This delay is bad for investor confidence, suggesting that our policymakers are thrashing about in the dark. People inclined to suspicion may even feel that circumstances are being aligned in favour of specific bidders.

The OUR ought to have known the volume of work that would be involved in this tender process and has no excuse for this amateur performance.

The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.