Former banker, Mr. E. Valentine Banks, and climate change activist, Mr. David Carty, have joined the CEO of the Anguilla Electricity Company Ltd (ANGLEC) to help with the electricity company’s thrust to migrate from fossil fuels to renewable energy technologies, through exclusive local participation in the renewable sector and the renewable energy roll out initiative. Mr Banks and Mr Carty spoke to the issue on the radio programme Talk Anguilla Rebranded, Part 2, on Wednesday, September 21.
Mr Banks said that he was excited about Mr Sutcliffe Hodge’s appointment as the new CEO of ANGLEC, and noted: “As a minority shareholder in ANGLEC, I was aware of some of the situations that have plagued the company over the years, and I felt that a lot of the issues came out of policies that seemed to be dragging the company in a direction that it should not have been going in.
“If Mr Hodge was going to achieve what he enunciated as his goals and objectives for ANGLEC, he needed to have solid systems in the company for dealing with human resource and corporate issues. That is where I have some experience for over 20 years, so I volunteered to assist him if he needed my services in ensuring that policies and procedures were aligned with his thinking.”
Mr Carty reiterated that his only involvement in ANGLEC is underpinned by his desire to assist the CEO of ANGLEC in “his iron-clad commitment to make the change to renewable energy, a position that I have been advocating for so many years.”
Mr Carty stated that he wholeheartedly supports the CEO’s argument for exclusive local participation in the renewable sector and roll out.
He said: “We cannot, should not, must not, do otherwise than to hold ANGLEC in Anguilla, for Anguillians and run by Anguillians.”
While he acknowledged that the Government may want to do things differently from the way the ANGLEC Board and Management want to do things, Mr Carty cautioned government “not to be lured into a quick fix – the Power Purchase Agreement (PPA) which has been on the table for renewables for over 20 years.”
He explained that although the legitimate business pitch of PPAs allows for a company to fund the purchase and implementation of the renewable system, at a contracted price for a specific period of time, the PPA typically goes on for 20-25 years:
“Whereas, you can be lured in by [the premise] that you don’t have to outlay your capital, but can buy a contract and pay it out over a number of years, in ANGLEC’s case, that would be millions. Although that’s a lure, you have to look at it for the long-term.”
Mr Carty made the point that whereas in the past, it might have been easier to go the route of PPAs due to cost, today, because of climate change issues, moneys are more readily available for funding renewable energy roll outs, making it less attractive to choose a PPA option:
“Climate change is now becoming a planetary issue. As a result, more and more funding is becoming available for renewables simply because one of the fastest ways to save the planet is to stop burning fossil fuels – diesel and gasoline – and switch to using renewables.
Mr Carty indicated that he plans to assist the CEO in finding the best source of funding for ANGLEC to roll out its renewable energy initiative, either through institutional lending agencies – at less than 2% – or through non-governmental agencies and grants facilities around the world that are eager to offer funding to make the transition to renewables.
He urged the government not to be lured by ‘the quick fix’ but, instead, to “sit down with a very objective conversation with ANGLEC to find a rational way forward.”
Mr Banks outlined, from his professional standpoint, a way forward for ANGLEC and the government in finding a resolution to achieve the objective of migrating to renewable energy:
“ANGLEC has over 1,000 small shareholders with the government, in a sense, controlling ANGLEC. Unfortunately, the government is also one of the largest creditors of ANGLEC, and at this point in time there is not a clear path that the government has put forward for dealing with that obligation.”
He stated that there has not been a sit down between government and ANGLEC, or a meeting of the minds regarding the issues, and expressed concerns about recent decisions made by the government and the Governor – concerns about the timing of the appointment of an Electricity Commissioner and the questioning by, and directives of, the National Security Council.
Mr Banks shared that the issue of government’s debt owed to ANGLEC must be addressed, especially in light of the rapid increases in fuel prices:
“Two years ago, the cost of diesel was EC$7.00/gal. On a yearly basis that was $40.8 million. Today, the cost of diesel is EC$16.00/gal which means it is over EC$93 million a year. That is over 100% increase – a huge gap which has to be dealt with.
“So, a creditor can’t just say, we’ll deal with it. There must be a real way to deal with it. And I think it can be worked out. I think these things have not really been addressed as they should be.”
Mr Carty underscored the fuel cost issue by emphasising that ANGLEC is burning over 16,000 gallons of diesel everyday and has to pay for it. He noted that whereas in the past they were paying EC$41 million, today they are paying EC$93 million, a difference of EC$52 million annually.
Mr Carty offered a suggestion as to how government can deal with the debt owed to ANGLEC, and proposed that the Government mortgage some of its shares to help ANGLEC at a time when it is preparing to develop a renewable energy plant.
The Government of Anguilla, the Social Security Board and the National Commercial Bank of Anguilla (NCBA), own 79% of ANGLEC’s shares, combined and Mr. Carty observed:
“One of the options the government can exercise is to call in the Board of Directors of NCBA and Social Security and formally pool their shares together, mortgage the value of the shares and raise funding on a temporary basis, or long-term basis to get ANGLEC over the bump – a year or two of having to continue buying diesel.”
Mr Carty expressed frustration that over the years, the government and ANGLEC had not made the connection between ANGLEC and climate change:
“It has infuriated me for fourteen years that governments and ANGLEC have never tied ANGLEC and renewable energy to climate change. They have never understood that the obstacle of climate change was the way to get renewables.”
He noted: [The] “Caribbean Development Bank (CDB) has recognised that energy independence and climate resilience have to be tackled by getting concessionary funding for renewables.
“Anguilla desperately needs water, but the water needs electricity and that electricity isn’t being paid for.
“Here is where the government has to be creative and walk with ANGLEC [and others] and say to the British Government that we have a major environmental issue, and the way to start with it is to help ANGLEC stop pumping green-house gases into the atmosphere – change from diesel to renewables, and we have a plan.”
