ST GEORGE’S, Grenada (CMC) – The Grenada government says it remains “concerned” at the decision by the main shareholders of the Grenada Electricity Company (GRENLEC) to seek international arbitration in a bid to resolve the company’s monopoly status.

The Grenada Private Power Limited (GPP), which holds a 50 per cent stake in GRENLEC and its parent company, WRB Enterprises Inc (WRB), on May 5 filed a request for arbitration with the International Centre for Settlement of Investment Disputes (ICSID), an arm of the Washington-based World Bank.“The purpose of this arbitration is to enforce the Government of Grenada’s contractual obligation to repurchase the 50 per cent GRENLEC shareholding that government previously sold to GPP,” GRENLEC said in a statement”.GPP and WRB commenced the ICSID proceeding in follow-up to a formal share repurchase demand that it had submitted to Government on March 22.But in a statement Monday, the Keith Mitchell administration said that it “continues to be concerned that GPP/WRB has sought international arbitration, in a premeditated action, instead of engaging with the Government to resolve the matter in a way that helps consumers and benefits the people of Grenada”.It said, furthermore, after deciding to escalate the dispute, “GPP/WRB is not even paying their way.“Instead, they are using GRENLEC monies to pay for international experts to help them in the dispute between two shareholders — a cost which is borne by consumers, the same Grenadian people who already are burdened by the company’s exorbitant electricity charges, and who would bear the burden of the huge sums GPP/WRB is trying to force the Government to pay for their shares.”The government said it is maintaining its position that citizens, including consumers of GRENLEC “come first” and that “our Grenadian people should not be forced to bear an unfair financial strain.“We also heard the cries of the many local and foreign, small and big businessmen and women, whose businesses were forced to close as a result of the weighty electricity costs that also inhibit investment.“Our mandate and our implementation of the Public Utilities Regulatory Commission Act and the Electricity Supply Act provide for correcting all of this, by promoting a favourable investment climate, and providing cleaner, more efficient energy and cheaper electricity costs.”It said “as such, we continue to seek good-faith, amicable negotiations with GPP/WRB, as we started doing several years ago when we moved to reform the electricity sector.“It is the government’s desire to see GPP/WRB put aside its “monopoly or nothing” mentality, and use of its majority shareholder’s power to financially distress the population, and join us in this endeavour where we all would benefit in a more competitive environment, by working together,” the Mitchell administration said in its statement.GRENLEC said the WRB had submitted the repurchase demand pursuant to the Share Purchase Agreement (SPA) that Government, GPP and WRB entered into in conjunction with government’s privatisation of GRENLEC in 1994.It said the SPA requires this repurchase to be completed within thirty days following Government’s receipt of GPP’s repurchase demand.The release said that given the fact that the government has not made the mandated repurchase payment, GPP and WRB have “no alternative means for protecting their contract rights other than by pursuing the ICSID arbitration as dictated by the SPA.“Despite these circumstances, GPP and WRB are open to comprehensive and collaborative negotiations with the Government to best serve GRENLEC’s customers, shareholders and the people of Grenada.”GPP chairman, Robert Blanchard, who is also WRB President, said during the past three years, GRENLEC, GPP and WRB “have made every possible effort to initiate good-faith, collaborative negotiations with Government focused on facilitating responsible and effective electricity sector reform in Grenada, and thereby avoiding the necessity of our taking legal action to protect our contractual rights.“Unfortunately, Government has consistently elected to rebuff these efforts by the GRENLEC team, opting instead to pursue a unilateral approach for restructuring every aspect of how GRENLEC’s system should be owned, operated and regulated,” he added.In accordance with the specific repurchase valuation requirements dictated by the SPA and set forth in Schedule II of the Electricity Supply Act of 1994, the repurchase demand for GPP’s 50 per cent ownership interest in GRENLEC amounts to EC$176.65 million (One EC dollar =US$0.37 cents).The government has disputed the amount as being asked for by the company.