Energy supply: Monopoly or democratization?

Will legality and the wider interest of the country be allowed to be torpedoed by illegality and lobbies that thrive on it?

Or will government show the same determination to stay course on its democratization agenda?

Events that took place in Bambous last week following the downpour that affected other parts of the island too compel us to focus on some pertinent issues related to the energy sector. They were considered in detail in last week’s editorial in this paper, which showed how in the mid-1990s, under pressure from the World Bank and the International Monetary Fund and with accommodation by government, the CEB was goaded to ‘give up its role as producer of electricity to the big sugar producers and to restrict itself to being its distribution and marketing agency.’

This has resulted in the CEB losing its key role in the production of electricity, so that up to 60% of the electricity the CEB distributes to the public comes from the four independent power producers (IPPs) of the sugar producers. Further, the contracts signed between the IPPs and the CEB are so made that the latter ‘has to buy up all the electricity produced by the IPPs in the first place and only then make good any residual shortage in the demand through its own production.’ A significant point to note is ‘the riskless rate of return the sugar producers ensured for themselves.’

Attempts by government to bring down the price of electricity by revisiting the terms of the CEB-IPP contracts have failed. The next alternative was through the democratization of supply, by allowing other operators to come in. But this has been met by restrictive market practices and well-timed, manipulated and loud obstructionist tactics, such as the inordinate delay of 8 years for the wind-energy producer Suzlon to come in. One must therefore commend the determined stand of the government to have ‘(finally) given the go-ahead to the CT Power project which, like the IPPS, will make use of coal, but in accordance with international standards and in a more efficient manner’.

Without surprise, though, ‘A few days later, excerpts from the report of the National Energy Commission, which was submitted to Cabinet last October, were published by a few papers. It looks like it was an organised leak for the relevant excerpts published clearly demonstrates the NEC, which is but an administrative commission, taking a stand in opposition to the government’s decision in favour of CT Power coal-fired generators and recommends instead recourse to natural gas and other green energy inputs.’

Government’s decision seems to indicate that it is not in a mood to give way to obstructionist initiatives and to keep course on its democratisation agenda, by opening up the economy to more players with a view to ensuring energy security in the long term. This, as well as the cost of energy to the consumer, is not the concern of only the Mauritian government. In the UK, for example, a similar concern is very much alive, and the conservative government in power is due in its forthcoming ‘Autumn statement’ by George Osborne to announce measures to cut at least 50 pounds sterling from electric energy bills.

Labour, through the voice of its leader Ed Milliband, intends to ‘improve competition and transparency to ensure “downward pressure” on bills. Power generation companies would be banned from exclusive deals with their retail ones, which critics claim they use to boost charges and disguise profits. New entrants would be allowed into the market…’ Further, ‘we will reset the market with real competition and proper regulation so that prices are affordable…’ (bold added)

The agitation at Bambous by illegal squatters is far from innocent, when we consider who all have been there and the visibility given in the weekend press, with no mention at all about illegality. All the blame is being put on the Sarako project, which has been given the go-ahead after due process, and which goes right in line with the NEC’s recommendation of having ‘instead recourse to natural gas and other green energy inputs.’

Some facts speak for themselves: this project represents an investment of 40 M USD for the country; around 15 000 tons of carbon dioxide will be saved per year and it will contribute to 50% of the yearly energy consumption of the West of Mauritius. Morever, there are some clear advantages of the Sarako, starting with the fact that it is in line with the Mauritian Government’s policy of making Mauritius ‘Maurice Ile Durable’ and create employment (direct and indirect) for 300 people. The others are:

* PV panels provide clean i.e. green energy. During electricity generation with PV panels there is no harmful greenhouse gas emission thus solar PV is 100% environmentally friendly;

* PV panels have no mechanically moving parts, consequently they have far less breakages and require less maintenance than other renewable energy systems;

* PV panels are totally silent, producing no noise at all;

* It will be the first solar farm in the region (Indian Ocean) on such a big scale;

* Mauritius’s image as a tourist destination will be enhanced, and it will be a reference for African and neighbouring countries;

* The project will help to uplift the village of Bambous.

It may be noted that no existing watercourse has been modified; all construction works are being carried out as per EIA and BLP conditions. Works for water drains have started and are still in progress, but unfortunately there has been heavy rainfall before completion of the works. Thus, whereas the rainfall in October was 16.5 mm, the screenshot from the meteorological station regarding the rainfall at Bambous on the 27th of November shows that there were 70.4 mm of rain in 3 hours only! This is almost 3 times compared to the normal values.

It is clear that nothing could have been done to stop so much of water coming from the mountain in such a short period, which the Director of the Meteorological station admitting that it was ‘du jamais vu’ in this region.

Will legality and the wider interest of the country be allowed to be torpedoed by illegality and lobbies that thrive on it? Or will government show the same determination to stay course on its democratization agenda?

* Published in print edition on 6  December 2013