By K. Quincy Parker
Nassau Guardian Business Editor
NASSAU, Bahamas -- The Christie administration in The Bahamas has remained silent on the sale of PowerSecure International to Atlanta-based Southern Company for $431 million, and the company itself has been mum since the initial press release announcing the sale, but others are less reticent. Former minister of state for public utilities Phenton Neymour, for instance, has expressed “great concern” about the timing of the whole affair.
On February 8, the government signed a management services agreement (MSA) with PowerSecure worth up to $25 million for the North Carolina company to take over management of the public energy utility.
The sale of PowerSecure to Southern Company was announced last Wednesday, and PowerSecure spokesman John Bluth confirmed that the sale -- and the negotiations leading up to it -- had been kept under wraps because both companies are publicly traded in the US and such talks are confidential.
The government has yet to comment on the sale.
Neymour spoke with Guardian Business about the sale on Tuesday.
“I am concerned, particularly when it comes to the timing. As soon as an agreement is signed then there’s a sale? That concerns me greatly,” he said.
Pushed to elaborate on his concerns, Neymour said, “They were just too close together for me. What is the relationship [between the signing of the BPL contract and the sale of PowerSecure to Southern Company]? Is it just coincidence? Or was it planned?”
“I don’t know the answer, so that’s why I’m concerned,” he said.
Among his many concerns, Neymour said the government must make the PowerSecure contract public.
“I would like to see the contract. I want to see all of the contract. I am not going by someone’s word. I want to see the contract so that we ourselves can judge what is given to PowerSecure and what PowerSecure is taking,” Neymour said.
“Once a contract is entered into, I strongly believe the public has a right to know that and the contents of it,” he said.
Neymour also asserted that the public needs to be told how PowerSecure will be graded on its performance, referencing the 150 percent performance bonus to which PowerSecure is entitled per contract year if the company hits certain key performance indicators (KPIs). The “predefined” KPIs are related to cost reductions, improvements in reliability and customer service enhancement.
Neymour told Guardian Business on Tuesday that the administration showed poor foresight.
“Whenever the government makes an agreement, as it did with PowerSecure, it is essential that one looks down the road with regards to what could potentially happen with that company and its performance. Therefore the content of their contract was essential.
“I don’t know what’s in their contract. They have not shared anything with the Bahamian public in regards to this agreement with them, and it concerns me greatly. It also concerns me, moving forward, that there are a number of things that PowerSecure has not done yet like present its business plan. This important information needs to be provided to the Bahamian public,” he said.
“The government, in my view, did not look down the road,” Neymour said.
Neymour, who during the 2008 Ingraham Cabinet shuffle was made minister of state for the environment, also challenged the whole MSA model.
“We in the Ingraham administration had also looked at various means and methods to address the various deficiencies at BEC. We looked at privatization, we also looked at a management contract. We felt at that time that a management contract would just be a Band-Aid solution to the issues at BEC... and that the best way to address BEC was privatization,” he said.
Republished with permission of the Nassau Guardian