GPL still failing to meet low targets, PUC decides not to fine it
While GPL continues to fail to meet the majority of its targets, the Public Utilities Commission (PUC) has decided not to impose a penalty on it but has highlighted the impact of high power losses on the financial stability of the utility.
The PUC made its decision in Order 1 of 2023 which was released to the media yesterday.
The Commission noted that while the targets continue to be set below industry standards, the Guyana Power and Light (GPL) was still failing to meet them. Further, technical and non-technical losses mounted up to roughly 25% percent of generated power which had been the target set in that category.
“GPL continually fails to attain the majority of its operating standards and performance targets as prescribed within the Company’ s approved Development and Expansion programme even though many of these targets are way below the industry norms. However, notwithstanding its statutory failings, the Company continues to implement and explore innovative measures to bolster its commitment to its consumers”, the PUC said in its decision.
The failings of the power company and the continuing high losses will also underline questions that have been raised as to whether GPL will be able to efficiently and cost effectively distribute power from the massive gas to energy project which could come on stream in 2024/25.
In its decision, the PUC also expressed “grave concern” that the Company insists on using the failure of handheld devices as a shield in the achievement of meter readings for maximum demand consumers. The prospect of improvements as the Company continues to procure and deploy new handheld devices is noted and the Commission is hopeful that this target can be met in the current year.
“Additionally, the high percentage of system losses continues to be a bane on the financial stability of the Company and it is another cause for continued concern. GPL needs to make a greater effort to reduce these losses as it will continue to hamper efforts to reduce the price of electricity to consumers”, the PUC said.
It however noted that many of the targets were ‘nearly met’ and the Commission after careful deliberation had determined that the imposition of a penalty on GPL, for its non-achievements of the consumer interruptions, voltage regulation, meter reading and average availability standards and targets is not warranted at this time although the non-attainment negatively impacts on GPL’s operations, especially in its bid to provide reliable, affordable and quality energy services to all its customers.
Under the PUC Act, the Commission is empowered to levy a monetary penalty on the Company in the event of the failure by the Company to achieve any of the Operating Standards and Performance Targets in an amount to not exceed 25% of the total value of the dividends which is payable to the Company’s shareholder(s) in the calendar year under consideration.
On the vital area of system losses, the PUC said that this standard sets losses which include technical and nontechnical losses at 25% of dispatched power for the year 2022. For the reporting period, system losses were 24.92% of dispatched power. This standard was achieved by the Company.
In their presentation the PUC said that GPL reported that the following initiatives underpinned the achievement of this target.
Upgrades to approximately 6 kilometers of low and medium voltage lines on the transmission network.
The installation of 67,684 smart meters capable of safeguarding against electricity diversion.
Replacement of approximately 10,849 meters on the distribution network.
Maintenance of approximately 1 ,566 transformers on the network.
Servicing of 10,287 distribution switches.
On the System Average Interruption Frequency Index: (SAIFI), the PUC said that the intent of this standard is to limit the average number of outages which consumers suffered during the reporting year. For the year 2022, the target was set at 90 outages. GPL during its presentation stated that the average number of outages experienced by consumers in the year 2022 was 94. That standard was therefore not met.
The PUC said that the Company collects data on the causes of all outages and in their presentation noted that feeder and transmission line trips and increased planned maintenance were the main reasons for the high number of customer interruptions during the year under review.
In relation to the System Average Interruption Duration Index (SAIDI), the PUC said that the intent of that standard was to limit the duration of outages experienced by consumers during the year. For the year 2022, the target set was 95 hours, however, the average duration of outages experienced by consumers during the year was 96 hours. That standard was therefore not achieved.
GPL indicated that the reasons for the non-attainment of that standard were the same as for the previous standard such as transmission lines and feeders’ trips which can be attributed to fallen branches that make contact with power lines resulting in electrical short circuits. GPL also said that the frequency of motor vehicles hitting poles are a cause for concern and as such the company is exploring the possibility of the use of concrete poles in the future to mitigate this frequent occurrence.
On the 29th day of March 2023, the Commission entered into its Annual Public Hearing to review the 2022 Operating Standards and Performance Targets of GPL.