EDITORIAL - No licence before facts on EWI

Among the more progressive and refreshing postures of the Simpson Miller administration has been its willingness to engage the private sector and its use of independent committees, with corporate leadership, to monitor projects critical to national development.

Richard Byles' oversight group of Jamaica's economic support agreement with the International Monetary Fund is a fine example of the potential of how such public-private sector partnerships can work to the country's benefit.

Another of these groups with great potential, if the Government genuinely respects its mandate, is the one overseeing the 360-megawatt, LNG-fired power plant. It is chaired by another of Jamaica's highly respected corporate executives, Peter Melhado.

The Energy Monitoring Committee (EMC) was established in the face of the controversy over the Office of Utilities Regulation's (OUR) accommodation of Energy World International's (EWI) late tender to develop the power plant and, subsequently, named as the preferred bidder.

It can't have been the expectation of the Government that merely naming the committee would have assuaged the critics. So, Mr Melhado's team has begun to do its job.

As provided for in the bidding process, the OUR commissioned a due-diligence report on EWI's ability to successfully complete the US$700-million project, which the company's critics continue to question. Phillip Paulwell, the energy minister, has signalled that based on that report, he is awaiting the OUR's formal recommendation for him to sign the licence for EWI to proceed.

It sounds like a done deal.

But Mr Melhado's committee, based on its public statement this week, has not yet been provided with either the full document or an abridged version of the report, evidence of EWI's ability to finance the deal, or the source from which it will acquire its LNG, with firm undertakings therefrom.

Indeed, three of Jamaica's leading private-sector groups - the Private Sector Organisation of Jamaica, the Jamaica Chamber of Commerce, and the Jamaica Manufacturers' Association - which are interested in the successful, efficient and economic build-out of the energy plan - have joined the EMC in calling for "thorough absorption" of the information in the due-diligence report, including the interrogation of EWI on matters that might need clarification. Obtaining the details on the company's financial capability is a critical part of this exercise.

We agree!

No ewi malice

This is no anti-EWI, knee-jerk position by this newspaper. We had insisted that, at the eleventh hour, it was not bad policy to have the EWI bid considered.

The same factors that shaped that perspective are the same ones that inform our current position. Lowering the cost of energy is too critical to the future of Jamaica's economy to get it wrong now. At US$0.42 per kilowatt-hour, the cost of power undermines the competitiveness of Jamaican firms.

In that respect, we must be sure that EWI has the financial commitments for the plant, and that it has the capacity and contracts for the delivery of LNG, and at which price electricity will be delivered to Jamaican consumers.

Prime Minister Portia Simpson Miller must instruct Minister Paulwell that there can be no signing of the licence until the EMC has a handle on these matters. Indeed, Mr Paulwell is more likely to find his reputation enhanced if he follows his own process rather than attempting to run around it.

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