With the country desperately short on natural gas and with the world paying a premium for the commodity, comes news that state-owned T&TEC is making a bad situation worse by deliberately taking less power from the most efficient producer and forcing the National Gas Company (NGC) to sell an additional 1.2 billion standard cubic feet per month to T&TEC.
To make matters worse, T&TEC is notorious for not paying its bills to NGC, and up to last year was owing the NGC close to $4.5 billion in unpaid bills for natural gas.
At the centre of the problem is T&TEC’s fear that there could be another islandwide black out.
According to the investigation done into the blackout, T&TEC never planned for such a scenario, where there could be a complete failure, and never put in place a back up line as a contingency.
With no back up line and the company not having confidence in all the equipment at Trinidad Generation Unlimited (TGU), T&TEC has tried to spread the risk by buying more power from Powergen and Trinity power and less form TGU.
The problem with that is that is TGU is the most modern and most efficient of the power producers and utilises less natural gas to generate power.
It also could not come at a worse time for the country and the NGC as prices for gas and related products are at record levels and production is significantly curtailed.
The first sign of trouble between the two state companies arose when the President of the NGC Mark Loquan told the energy chamber’s 2022 conference that the country has to ensure it uses each molecule of natural gas in the most efficient way, including sending those molecules to the most efficient use in the power generation sector.
Guardian Media reached out to the NGC and asked for numbers on the impact it was having on the NGC but the company would only say: “Given its confidentiality obligations, NGC is precluded from disclosing specific volume information.
NGC is in discussions with T&TEC to seek to optimise the use of gas molecules supplied to T&TEC thereby maximising the volumes that can be supplied to the Petchem sector. This has been a deliberate focus of NGC in its discussions with T&TEC and other related parties as NGC seeks to maximise value to its stakeholders.”
The Business Guardian also reached out to T&TEC to find out the rationale behind the decision. T&TEC eventually responded and said: “Decisions concerning the operations of the grid are dynamic. Coming out of the incident on February 16th 2022, T&TEC has received and reviewed the report form the Cabinet appointed investigation committee. Based on the said report we are working with the Independent Power Producers (IPPs) and other stakeholders to implement the recommendations. This process is ongoing to ensure that we provide a reliable and stable supply of electricity to our customers.”
But Public Utilities Minister Marvin Gonzales was a little more forthcoming and told the Business Guardian that he was expecting a report from T&TEC on the issue.
“I am awaiting a full report from T&TEC on this particular matter, there are some issues with respect to TGU and the efficiency of some of the machines there, so T&TEC is working on it and is in conversation with the TGU to resolve all of those outstanding issues, but just to ensure that we don’t have the possibility of another partial islandwide blackout, as the case may be, to ensure there is sustainability on the national grid, T&TEC took this position temporarily in order to be satisfied that the issues at TGU are addressed to its satisfaction before they can go back taking the amount of electricity from the TGU plant,” Gonzales told BG.
He explained that the problem had nothing to do with T&TEC having to put in place the extra line and said while such a line will assist in ensuring that there is not another islandwide blackout it has everything to do with “T&TEC having that level of confidence in the full operation of the TGU plant,” Gonzales said.
Asked if he was not concerned about the cost to the country of T&TEC’s actions, the Public Utilities Minister said: “It is of concern to me as Minister of Public Utilities because, of course, it is causing some concerns to the NGC.
“It is a matter that I am in active discussion with Minister Young. The Chairman of T&TEC is also very much concerned about the matter and we are putting our collective heads together to address the problem.”
Gonzales was asked if it was likely to be resolved in the next two to three months.
He said: “Yes certainly, it must!”
The Business Guardian told the Minister that this was essentially the country wasting 1.2 billion standard cubic feet of natural gas per month.
He replied: “Exactly! So this is not sustainable especially given the price of gas at this point in time and given the fact that T&TEC is already owing NGC huge sums of money. We certainly cannot allow this to continue. So this is something that Minister Young and I have been discussing and the Chairman of the T&TEC is also working on a special report to present to me on this particular matter.”