WRB takes on government

A battle is brewing between the three-year old Keith Mitchell Administration and the United States-based Company, WRB Enterprises Inc, the majority shareholder of the Grenada Electricity Company (GRENLEC) over the passage in Parliament of the Electricity Supply Bill, 2016.

“I want to be very clear, if we are forced to protect our rights under the agreement we will do so,” Vice-President of Engineering and Regulation with WRB, Murray Skeete told members of the media during a press conference that was hosted by GRENLEC at the Grenada National Stadium on Monday.

GRENLEC officials Murray Skeete and Colin Cover

GRENLEC officials Murray Skeete and Colin Cover

Skeete who is a GRENLEC Director on the governing board, stopped short of indicating whether or not WRB Enterprise Inc. will proceed through court litigation to protect its rights.

“I need to be careful here, and remind the audience (that) I’m an engineer, not a lawyer. The agreement is very clear, the agreement has language in it… and it is not legal action, it is purely invoking a clause in the agreement which, regrettably, will result in significant financial consequences to the State of Grenada,” he said.

According to Skeete, the clause states that in the event that government changes the legislation in a way that will abrogate the rights of WRB and the rights of GRENLEC, it requires government to repurchase WRB shares.

He said the agreement that was established between GRENLEC and the Government of Grenada over the past 22 years when WRB formed the public/private partnership in 1994 was put in place to protect both parties.

The GRENLEC Director stated that the agreement has served the company and Grenada well over the years, however once one party seeks to make changes to the agreement, the correct process is to engage the other party in negotiating a new agreement.

“That’s not what is happening today,” he emphasised.

Skeete said GRENLEC has been trying to dialogue with the new rulers in St. George’s for probably more than three years.

He told reporters that up until March 20th both parties (Grenlec & WRB Enterprises) were having what was believed to be constructive dialogue with government, but four weeks later they learnt through the media that government was bringing the Bill to Parliament.

He accused the Keith Mitchell Administration of altering the fundamental legislation which forms part of the agreement on a unilateral basis.

He said the way government has decided to make changes to the agreement may result “in significant consequences to the State of Grenada.”

“That legislation… does nothing to develop the future of Grenada. It is vesting tremendous amount of power in a single minister, and we feel that, on the whole, the legislation as is drafted… is going to be detrimental to the energy sector in Grenada,” he remarked.

Skeete said WRB believes the public/private partnership has served the shareholders and Grenada well, and is committed to being in Grenada for the long term.

The Engineer pointed to the state of the company at the time of privatization back in 1994.

He recalled that the power plant at Queen’s Park was in a fairly deplorable state with a number of old and inefficient generators.




Skeete said there are now modern efficient engines at the plant, noting that following the catastrophe caused to the island by Hurricane Ivan in September 2004, the entire rebuilding of the system was undertaken by GRENLEC.

He added that GRENLEC has invested more than $225M in the system over the past 20 years.

The new Bill seeks to end GRENLEC’s 80-year monopoly in the supply of electricity on the island that was granted during the privatisation under the then National Democratic Congress (NDC) Government of Prime Minister Sir Nicholas Brathwaite.

Chief Executive Officer (CEO) and General Manager of the electricity company, Colin Cover who also addressed the media indicated that the electricity industry has been transformed over the last 22 years through technology.

Cover said because of this GRENLEC and its shareholder partners believe that sufficient time has expired, and that it is reasonable to come to expect changes to be made to the existing agreement.

He stressed that GRENLEC understands that government has a right and an obligation to create legislation to govern the environment and to promote the development of the country’s energy goals.

He said the utility company is not saying government cannot pass legislation, but when the legislation will have a wide effect on the entire population, consultation is very important.

According to Cover, while it is agreed that there were consultations, they believe that much more in-depth discussions were needed with the major players in the industry.

“We are open for discussion on every single item that is in the agreement between ourselves and the government, and we would like to continue to work in this fashion that we have worked with government over the past 22 years,” he said.

The GRENLEC CEO indicated that the issue at hand is not political.

This is a draw back from the statement issued last week by the company when it slammed the Mitchell-led administration for its handling of the issue.

The statement said in part that the administration was trying to put in place “a politically motivated, ideological conceived and totally discretionary new regulatory regime” to govern the electricity sector in Grenada.

“That new regime will rely upon two key components: (1) an operationally inefficient market design (which is contrary to international best standards for stand-alone island economies like Grenada), plus (2) an undeveloped, expensive, totally discretionary and politically controlled new regulatory process”, it added.

Cover sought to downplay the notion of Grenlec taking pot shots at the current rulers within the NNP.

He said: “We are not supporting any (political) party, or are we against any party. We have an agreement with the Government (of Grenada), whichever party might be in power, we have an agreement with the government, and so I don’t want anything we say to be construed as political as against one party for another party. We just simply here trying to get what we think is the best for the Grenadian economy”.

Throughout the week, officials of GRENLEC have been making a number of media appearances to bring to the attention of the General Public the company’s perspective on the new piece of legislation.

Once the Bill comes into effect it will repeal and replace the 1994 Electricity Supply Act that provides for GRENLEC to maintain its monopoly in the supply of electricity until 2073.

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