Boakye Agyarko, Energy Minister
President Nana Addo Dankwa Akufo-Addo has indicated that his administration is conducting a review of the power agreements signed by the previous National Democratic Congress (NDC) administration.
The President, who was delivering his maiden State of the Nation Address in Parliament yesterday, said the move would enable the new government to prioritize, renegotiate, defer or cancel outright, if necessary, all such agreements in the interest of the nation.
He indicated that as at the end of December 2016, ECG had signed 43 power purchase agreements (PPAs), while 23 additional ones were under discussion.
Huge Debts
According to the President, the New Patriotic Party (NPP) government inherited a huge debt profile in the power sub-sector from the previous NDC administration.
President Akufo-Addo said “we have inherited a heavily indebted energy sector.”
He disclosed that the net debt of the energy sector as at December 2016 stood at a whopping $2.4 billion.
Out of that amount, he said $800 million was owed to local banks, adding that the development threatens the banks’ stability and the whole financial sector.
“Indeed, the huge indebtedness of the energy sector constitutes the single major hurdle to Ghanaians enjoying reliable and affordable electricity supply,” he stated.
Businesses Suffering
Mr. Akufo-Addo stated emphatically that the current huge cost of energy in the country was negatively affecting businesses which have worsened the plight of the Ghanaian citizenry.
Suggestions
To address the problems facing the power subsector, the President said his government would comply strictly with the procurement law, among others.
“Mr. Speaker, my government will enforce the procurement law; we will insist on open and competitive bidding for power capacity procurement,” he indicated.
According to him, “This will not only reduce the cost of power projects and ensure value for money but also address the problem of unplanned procurement.”
The President pointed out that “government will encourage increased private sector investment in utility scales – solar and wind energy projects- as well as accelerate the development of many grid solutions in off-grid and island communities for lighting, irrigation and other economic activities.”
Renewable Energy Act
“We will consequently review the renewable energy act to provide further incentive to attract the private sector to invest,” he underscored.
Compact II
“The Ghana Compact II Programme has officially come into force. Both parties to the compact – the governments of Ghana and United States of America- are committed to complying with their obligations.”
“However, the implementation of Ghana’s commitments has faced some challenges due to disagreements between stakeholders, particularly between labour, ECG and MIDA.
“We need further dialogue on the key issues that have generated the disagreements. We are aware that these discussions should be concluded urgently in order to arrive at the decision that will allow for its implementation”
“I expect all stakeholders to meet to discuss such issues dispassionately and transparently to ensure that all concerns are adequately addressed.”
Listing
Meanwhile, the President gave the hint that the Volta River Authority (VRA) and GRIDCo are being considered for listing on the Ghana Stock Exchange (GSE).
“Overall, we have begun to develop a national electricity master plan, which will also explore the benefits of listing VRA and GRIDCo on the stock exchange,” he said.
BY Melvin Tarlue