hot air & sunshine

“And my heart was breaking and got left unlocked
Didn’t see you sneak in but I’m glad you stopped
Tell me something I don’t already know
Like how you get your kisses to fill me with electricity”

-Arctic Monkeys

An aid funded programme of renewable energy development (hydro and wind) to replace diesel generation, and damaged infrastructure is ongoing in Samoa.

Over the last fortnight of I’ve been helping with what might be an overly specific niche business training course…I could tell you about it- but not without a beer.

Anyway- one challenge was the departure of electric power midway through the course- thankfully killing off the twin jet powered air-conditioners blasting 16 degree virus laden fumes through the room.

But, in tribute to modern tropical architects…even opening all the doors and windows could not avert trapping every degree of natural heat & humidity - while still managing to completely avoid catching any of the incessant and presumably irritating cool sea breeze which habitually blows over Apia harbour.

Which brings me to the EPC- Electric Power Corporation…a wholly government owned, monopoly electricity provider.

On that day- as well as irritating me, the EPC had managed to knock out the power to parliament mid session. One optimistic parliamentarian putting it down as a minor issue related to  “deteriorating services” in the “aging” parliament building…now undergoing a $20M aid funded redevelopment.

It seemed slightly ironic that it was the same week that the PM and representatives from EPC were on the front page of the paper holding a giant cheque (presumably latex) for a $1 million tala government dividend.

..turns out it was not ironic at all, considering it was less than a month after EPC declared 62 redundancies (from a total of 400 employees) and a $900k saving in payroll.

…not long after tendering in the local newspaper for 15 new vehicles

(which if valued somewhere between $60k and $100k - would equate to $1M to $1.5M)

…while they speculated about “outsourcing” operations such as “powerlines… pulling wires, putting up wires, trimming trees…and running power stations.”

…Confusingly, back in May this year, EPC was proposing a reduction in rates to consumers. “And it’s not normal for any utility to do that,” they said.

They’re right. It’s not.

Even then stating that…“ the pressure is on for E.P.C. to generate a profit as required by the law”. A figure of 7% ROI. “E.P.C. has never achieved the 7% …the new Minister has put his foot down on State Owned Enterprises to produce profit to Government..."

E.P.C.’s total equity of about $200M makes that about $14M.

…oh, and then there’s the $10M loan from the Asia Development Bank which they’ve requested be “converted into a grant”.

Ever had a loan like that?

EPC has been a basket case for a while…if you look back a bit further…

In 2015…

“…E.P.C. is at a debt to equity ratio of 96 per cent- almost all of its assets are financed by debt”

In 2012-13

…compensation for Directors and executive management increased by 26%

…Director’s sitting allowances increased by about 380%

(from $2,218 per Director in 2012, to $8,400 each in 2013.)

… in Samoan tradition, catering for Board Meetings increased 330%

($7,904 in 2012 to $26,207 in 2013).

…while a dispute arose between EPC and the Ministry of Revenue on unpaid import duty of $1.9M.

…and EPC annual net profit dropped roughly 80%

My favourite understatement is that of the Chief Auditor, that…“the Corporation’s activities expose it to a variety of financial risks.”

http://www.samoaobserver.ws/component/search/epc/%252F?ordering=&searchphrase=all