Setting record straight on granting licence to JPS

THE EDITOR, Madam:

Mr Phillip Pauwell is more than disingenuous in attributing to the Jamaica Labour Party administration that I led the all-island electric licence granted to the Jamaica Public Service Company.

The facts are as follows:

(1) The company was originally granted a 20-year licence in April 2001.

(2) Following the acquisition of 40 per cent ownership by Marubeni in 2007, the then People’s National Party administration with Mr Paulwell as the minister responsible for energy, as a condition of its approval of Marubeni’s share ownership, required Marubeni “to agree to certain provisions which, in the opinion of the GOJ, was (sic) necessary to ensure the viability of the Licensee as the sole distributor and supplier of electricity throughout Jamaica and the safe, reliable an economic supply of such electricity”.

(3) By letter dated July 9, 2007, Marubeni agreed for the licence to be amended to make provision for:

a. The authority of the OUR for the preparation and revision of all requisite least-cost expansion plans for the addition of generation capacity;

b. The authority of the OUR for the management and administration of the competitive process for the addition of any new capacity;

c. Specific requirements relating to a transmission and distribution code, a merit order dispatch system, a spinning reserve policy, and an effective and appropriate loss- reduction policy;

d. The term of the licence be extended so that the 20-year period, which commenced in 2001, would now run from July 9, 2007.

(4) The amended licence that was gazetted on August 19, 2011 while I was prime minister simply gave effect, as the Government was obliged to do, to the agreement entered into by Mr Paulwell’s government in July 2007. Indeed, the preamble to the amended licence states: “In order to fulfil the outstanding terms and conditions of the said 2007 Letter of Agreement……the Minister and the Licensee now agree to amend and restate the All-Island Electric Licence 2001 as set out herein”.

The licence under which the Jamaica Public Service Company operates is due to expire within the next three years. It is urgently in need of review. Let us focus our attention there and avoid distorting how it came to be what it is.

BRUCE GOLDING

Former Prime Minister of

Jamaica