BRE Contract Hitches

The Buchanan Renewable Power contract seems to be encountering some difficulties, at least as far as some technical aspects of the contract is concern, President Ellen Johnson-Sirleaf has conceded, adding that it worries her.

“Yes, it worries me, but we are very aware of why it has not taken off,” she told this paper in an exclusive interview recently.The negotiation is still on; if they meet some of our final recommendations that project will still go on,” She said.

“There are two aspects of BRE,” she explains, “One is the production of woodchips by cutting down and processing of old rubber trees, which they can export. The second one is to use some of those woodchips for power generation.”

“Where we have our problem now is the price that they want to put on the woodchips that will be used for power generation. We say the price they are putting on it is too high for woodchips that come from our own natural resources. “

“And in the power purchase agreement with the LEC (Liberia Electricity Corporation) that’s where the problem has come. And we have not agreed to the fiscal incentives they want from the chips,” President Sirleaf said.

She said negotiations have been going on for months and neither the government nor BRE has reached the place where it says “okay, we’ve got a fair compromise. “ She said government has also engaged some of its partners in the power sector and it is also gathering their opinion and their opinions have also been one of concerns.

LEC Contract & BRE

President Sirleaf: “The management contract itself will not hinder it because that management contract is tied to two things: One to make LEC itself more efficient. Secondly, to provide some resources for the distribution network, the one that will put up some poles and wires to connect the whole of Monrovia.

And what would be affected by the BRE is if we were to get a hydro; when the hydro comes on screen that would be the most cost efficient way for electricity. But the BRE Plant is only going to provide 35-megawatts, which are not a lot of power.

The only innovative thing about it is that it is a good, clean form of energy and it burdens our own resources and also the hydro because it is so capital intensive. It will take a long time; it will take at least three years to build a hydro.  The BRE even has slipped that one cannot come on before 2012.

Others interested in woodchips projects here

President Sirleaf: As long as they (companies) can make a proposal that involves competition and does not undermined the commitment we have already made to BRE, if the two of them can compete and if there is a sufficient rubber trees for all of them to be able to carry out, we’ll promote it.

One of the things we like about the woodchip program is that it has a replanting of the rubber from our farms and that is a very good byproduct.