Chief Pleas is currently attempting to complete the compulsory purchase of Sark Electricity Ltd, funded by a loan from its Bailiwick neighbour.
The details of the loan were due to be discussed at the last meeting of Chief Pleas but the item was removed from the agenda and instead will be the subject of an extraordinary meeting, expected now to be held on Wednesday 11 March.
Conseiller Frank Makepeace said one thing was already clear.
‘Borrowing £1.5m. at 6% over 25 years will mean that Sark repays around £1.4m. in interest alone,’ he said.
‘Bringing the total cost of the loan to approximately £2.9m.’
He said he was particularly concerned that the island’s Policy & Finance Committee had published a document stating that the majority of conseillers outside the P&F Committee will receive only a ‘summary’ of the loan terms, and not the full terms and conditions.
‘What I find very difficult to understand is why no investigation appears to have been carried out into the possibility of a community or government bond, allowing local people to invest in Sark’s future,’ he said.
‘Such a bond could have enabled residents to contribute at whatever financial level they felt comfortable with. Even at the same interest rate of 6%, the £1.4m. in interest would have gone back into the pockets of local investors, rather than leaving the island.’
‘When we are talking about borrowing nearly £3m., the least the island deserves is full information and all reasonable alternatives being properly considered.’
A spokesman for Chief Pleas said the option of raising funds through a community or public bond had previously been discussed within Chief Pleas.
‘This option remains under consideration and will be pursued once the compulsory purchase of the existing assets has been completed,’ he said.
‘At this stage, it is considered that a government-to-government loan represents the simplest and most reliable mechanism to secure funding for the initial phase of the project, removing uncertainty while the compulsory purchase process is concluded.
‘Following the initial acquisition and essential “make-safe” works, there will be opportunities to refinance and raise additional funding to enable a full overhaul of Sark’s electricity infrastructure, ensuring it is more resilient, sustainable and affordable for future generations.’
He added that ahead of the extraordinary meeting to discuss the loan, conseillers will receive an advance briefing from officers from both Guernsey and Sark to ensure they are fully informed.
‘The immediate priority is clear – to bring SEL’s assets into public ownership, safeguarding a reliable electricity supply for the island and enabling Sark to plan the transition towards a modern and sustainable energy infrastructure.’