Independent Power Producers (IPPs) have received assurances from President John Mahama that the government will assist them in producing the energy required to increase the nation’s supply of electricity.
He lamented the Electricity Company of Ghana’s (ECG) inadequate management and promised to take the initiative to restructure the energy industry while maintaining the ECG’s smooth operation.
“I mean, you can’t run an electricity utility and make 40 per cent commercial and technical losses and continue to think that you have a viable business,” he remarked.
“And so, if we do it more transparently, more fairly, more competitively, I’m sure that we’ll get an efficient partner to join us in terms of billing and metering so that we can eliminate the huge losses that ECG is making.”
He reaffirmed the important role IPPs play in the nation’s energy sector, which supports government initiatives to leverage the capital needed to produce the nation’s electricity needs.
During a meeting with IPPs in Accra on Monday to talk about the difficulties they had in their operations and how to resolve them via cooperation, the President made the promise.
“It was important that we expand the space for independent power producers, because the Government on its own cannot always leverage the capital to put in the generation that is required,” he stated.
“And that’s how come many of you signed the PPAs (Power Purchasing Agreements) and set up the thermal plants that we have.”
“That was to help increase generation as the Akosombo Hydro Dam alone could not continue to be the sole power provider for the country, forever,” he said.
Therefore, the Volta River Authority was in charge of providing thermal energy to Ghanaians to supplement hydro.
“But mobilising capital early enough and being able to operationalise thermal plants was becoming a challenge for government and its state-owned power production companies,” President Mahama stated.
IPPs like Sunon Asogli Power began to join at that point and have since been essential in ensuring that the country’s economy has the power it needs to keep growing.
“However, this has generated some debts, which had accumulated and become difficult to pay back,” he stated.
According to the president, the Energy Sector Levy Act (ESLA) was introduced by his former administration with the expectation that Ghana would be able to pay off its legacy debt in five years, given the sector’s expected revenue.
However, President Mahama stated that the ESLA was not utilized for its intended purpose following the 2017 government change, adding that “The revenues of ESLA were mismanaged. And so, what should have gone to pay down a lot of the debt was used for other purposes.”
He appealed for investment in the sector and said that Ghana was once again open for business.
Source: newsthemegh.com