House approves $4B to address ‘cash flow crisis’ at GPL

The National Assembly on Monday approved a $4 billion allocation for the Guyana Power and Light (GPL) as part of a larger $44.8 billion supplementary funding the government has requested.

During the consideration of the request on Monday, Finance Minister Dr. Ashni Singh said the monies will go towards addressing the “tremendous liquidity and cash flow crisis” the PPP/C government, as the sole shareholder, inherited within GPL in 2020.

At the end of 2021, the House had approved a $4 billion bailout for the power company; but facing a $13 billion debt at the time – owed by government ministries and agencies – further support was necessary.

Dr. Singh said this latest support was necessary as the increase in global fuel prices had also affected the company’s operations.

The Minister said fuel prices have increased from US$40 in 2020 to over US$100 per barrel in 2022.

“… and we have, as a matter of policy given the commitment to absorb the fuel price increase and not pass it onto the consumer.”

“These further efforts are to ease the cash flow challenges the company is facing,” Dr. Singh added.

GPL had said that the fuel price increase has moved its total monthly operating expenses to approximately $4.5 billion against monthly electricity sales of approximately $3 billion.

Previously, Dr. Singh had reminded of the inherited burdens of a mismanaged and bankrupt GPL which came to be during the 2015 – 2020 period when the APNU+AFC Coalition was in government.