The National, Wednesday February 12th, 2014
By JOHN TANGIT
Recent letters in the newspapers raised issues of transparency, accountability and performance relating to PNG Power Limited (PPL).
I joined PPL (formerly Elcom) as a young engineer 26 years ago and made my way up to be at the helm of this company.
I am not a “fly in by night” CEO or someone who moves around looking for greener pastures. I grew up with the company.
PPL is a highly technical and capital intensive company.
The power disruptions experienced by our legitimate customers are mainly caused by factors such as ageing assets, natural and human causes, planned outages, geography and logistic issues and operating in loss centres, etc.
Most assets that PPL owns and operates have been inherited from Elcom.
PPL toils and perseveres on a daily basis to ensure that these assets operate efficiently in order to provide electricity to its customers.
There are electromechanical problems inherent or associated with these assets as most of them have been used or operated for 30 years or more.
These legacy issues can only be resolved with adequate funding generated by PPL or provided by the Government.
It should be appreciated that without the ingenuity of hardworking engineers and technical officers most infrastructure and machines could not operate efficiently.
Papua New Guinea is prone to natural disasters and these events affect the generation, transmission and distribution of electricity to PPL customers.
Storms, lightning, floods, prolonged drought, etc affect power generation, transmission and distribution.
For instance, the dry spell affects the generation capacity of hydro dams as evident in Rouna.
Likewise the storms and lightning easily affect transmission and distribution lines.
In a situation where a transmission line is affected by storm along the vast Highlands Highway, our officers brave the life threatening weather conditions to attend to and fix this fault.
Many people live in the comfort of their offices and homes and complain against PPL when there is a blackout but they do not acknowledge the enormity of work our officers are performing and the magnitude of the problem they are faced with when dealing with the blackout issues.
The power disruption is caused by human activities.
There have been instances of landowners’ interference in the form of threats, sabotage of assets and compensation demands, which impact greatly on generation and supply of electricity to our valued customers.
The felling of trees by people, vehicle accidents, particularly when a vehicle hits and damages a power pole, cause power disruptions.
PPL spends huge sums of money every year on provision of security to our installations and assets throughout the country.
This large amount of money could be better spent on replenishing and or refurbishing PPL assets if our people become sensible to choose between essential services and unrealistic demands such as claiming compensation.
The other nightmare PPL faces is compensation claims from people whose relatives or associates are electrocuted, particularly when carrying out illegal connections.
Hence these threats, sabotage, and compensation demands directly affect power generation, transmission, distribution and eventually retail to the customers.
Further PPL is required to carry out planned outages to do routine maintenance on its electricity assets.
These maintenance programmes are necessary to ensure desirable and sustained services to the customers. Routine maintenance is a mandatory intervention to ensure operability and longevity of the assets. These maintenance schedules result in load shedding and power outages.
The typical PNG terrain, fast flowing rivers, coupled with logistics deficiencies makes provision and sustenance of electricity a daunting work for PPL.
This factor is exacerbated by the link length exposures in the cases where PPL transmission lines run very long distances and transcend provincial or municipal boundaries.
There are elements of risk inherent and associated with these exposures and PPL technical employees have real practical and technical dilemmas in attending to these issues. PPL is faced with the challenge of procurement of expensive spare parts, which are procured from suppliers overseas which, takes up to two to three months.
The time to source spare parts abroad definitely prolongs power disruptions. There are interconnections and complexity factors which cause power disruptions.
An electrical or mechanical fault in a certain asset or machine impacts on the regularity and frequency modes of electricity as the system is forced to carry additional loads due to the failure.
The dynamics of the systems are intricately delicate and complicated.
The other predicament PPL is placed in is to meet the community services obligations to provide electricity to loss making centres.
Eighty per cent of the centres where electricity services are provided to are loss making centres.
In other words, if PPL was to strictly operate a commercial entity, it would not have provided services to these centres.
For instance, the cost of fuel to generate electricity to these places is extremely excessive but PPL still provides services to these customers as part of its community services obligations.
Electricity thefts are common in the country. They are some people who steal electricity from PPL through illegal connections such as by-pass and tampering with meters.
PPL does not make money from its power generated and supplied.
Since, PPL operates merely on the strength of its balance sheet, issues such as community services obligations and electricity thefts impact adversely on its income and its ability to improve its operations and services.
Despite all these existing and prevailing circumstances, PPL ensures its energy is equally spread throughout the country and not Port Moresby alone as suggested by Momberl.
Each centre has its own operating and maintenance regimes depending on the circumstances on the ground.
Contrary to what the critic has said, PPL has very lean and streamlined procurement system. The suppliers that provide services to PPL are vetted within our systems.
The payments are linked to our oracle systems to control and eliminate abuses.
PPL has a rigorous tender process that effectively screens all potential contractors and those who pass the company due diligence processes are engaged.
If he has evidence of my employees receiving kickbacks/bribery, then he can formally register these issues with my office, the chief operating officer or one of the general managers so that appropriate investigations can be carried out.
His comments on the human resources business unit are noted however, as far as I am aware, this business unit has undertaken some very good initiatives recently and that includes the Performance 3 Management System.
If Momberl has got some brilliant ideas, then he can raise them through proper channels so that the management could deal with them accordingly.
In relation to his assertion that PPL should outline its achievements for PNG, I, with the greatest humility, would say that PPL has done so much for PNG in its existence as an entity for the past 50 years.
PPL has built schools, sponsored national and international events and sports, built roads, townships and other infrastructure, operated in loss centres, published safety information in the media, undertook rural electrification programmes, and importantly provided electricity services to PNG since 1963 and will continue to do so.
As the CEO I now put it on record that PPL is a silent achiever and does not openly preach for everything that it does for PNG.
Actions speak louder than words.
Finally I rebut the critic and say that PPL has a mixture of experienced and young, highly intelligent and educated management team, who are fairly remunerated for the work they are doing for PPL.
They have tirelessly and devotedly worked for PPL and will continue to do so despite all the negativities that are being speculated and circulated around them.
- JOHN TANGIT is chief executive officer of PNG Power Limited