The main opposition National Democratic Congress (NDC) is calling on the Keith Mitchell-led New National Party (NNP) government to engage in “professional negotiations” on the Grenlec issue with the Grenada Private Power Limited (GPP), the 50% shareholder of Grenlec, and its parent company WRB Enterprises Inc (WRB) of the United States.
GPP has approached the International Centre for Settlement of Investment Disputes (ICSID) of the Washington-based World Bank for arbitration in a matter involving the administration.
The company, owned by the Blanchard family, is seeking intervention by the World Bank body to enforce the buy back clause in the Share
Purchase Agreement that was signed with the 1994 Congress government of late Prime Minister Sir Nicholas Brathwaite which had privatised the once state-owned utility.
Prime Minister Mitchell and the NNP have often engaged in a hostile stand-off with the U.S-based majority shareholder in Grenlec.
The latest development stems from government’s passage of the Electricity Supply Act in June 2016, repealing the Electricity Supply Act of 1994, which brought an end to WRB’s 80-year monopoly on the country’s sole energy provider, Grenlec.
Assistant Public Relations Officer of Congress, Ron Redhead expressed concern with the latest developments surrounding government and Grenlec at Monday’s weekly NDC press conference in St. George’s.
“We do not believe that the approach taken by the government to bully its way through WRB was the best option as it creates a negative image of the country”, he told reporters.
According to Redhead, there is need for ongoing negotiations by government with WRB to ensure that the company would “foster the involvement and creation of alternative energies into the Grenadian economy”.
The Mitchell-led government has introduced legislation aimed atending Grenlec’s monopoly on the supply of electricity in the country.
Grenlec has stated that it is not opposed to competition in the sector but felt that more time needed for discussions to be held on the issue.
Redhead disclosed that the 2008-13 Congress government of former Prime Minister Tillman Thomas had taken measures “to ensure that we prepared a national energy policy to guide the framework as to how we will go ahead (in the energy sector).
“We saw two fundamental issues – one being the external cost of a barrel of oil on the international market and fees and duties that Grenlec/WRB would have had to pay for importing fuel.
“What we did at that point was to reduce that cost by 50%, which went back up after the (NNP) Structural Adjustment Programme came into being…and so we want to reiterate the call, because these we believe are fundamental things in ensuring that energy cost for Grenadians are held at a reasonable rate that we can manage.
Government is said to be reluctant to appear before the arbitration tribunal issue for arbitration since it could hurt the island’s image in the international community.
GPP and WRB commenced arbitration proceedings in keeping with the buy-back clause in the SPA that submitted to the Mitchell government on March 22, 2017.
The SPA requires the repurchase to be completed within 30 days of receipt of the proposal.
Government has reportedly failed to buy back the 50% shares held by the American company, which was put at EC$175 million.