The Millennium Development Authority (MiDA), has selected Meralco Consortium, to manage the Electricity Company of Ghana [ECG], under the power compact Two agreement.
Meralco Consortium is led by the Manila Electricity Company from the Philippines.
A statement from MiDA copied to Citi Business News said Meralco Consortium is known to have the highest combined technical and financial score, and has therefore been designated as the Preferred Bidder.
The company is said to have distribution network which covers a third of the Philippines and serves a customer population in excess of six million. It will be recalled that CH Group recently pulled out of the list of bidders leaving BXC Company Limited and Meralco Consortium.
Negotiations will soon commence to finalize all the agreements related to the implementation of the ECG PSP Transaction.
Per the compact, the Millennium Challenge Corporation is expected to inject about 418 million dollars into ECG, whiles Meralco will invest about 500 million dollars.
President Akufo-Addo changes terms of compact
President Akufo-Addo, during the 2017 edition of May Day celebration, announced that government will stand by a decision to amend the Private Sector Participation (PSP) agreement of the ECG with the Millennium Challenge Corporation(MCC).
Under the original agreement signed by the erstwhile John Mahama government, the Power Compact II was expected to allow about 80 percent private sector control in ECG for the country to benefit from a total cash injection of about one billion US dollars over a period of 5 years.
But Nana Akufo-Addo maintained that government wants more than the 20 percent control agreed by the former government.
The compact was renegotiated to allow 51 percent local private participation and duration of control reduced from 25 years to 20 years.
Details of Compact II
Under the Power Compact, six projects will be implemented to address the root causes of the unavailability and unreliability of power in Ghana.
The project include ECG Financial and Operational Turnaround Project, NEDCo Financial and Operational Turnaround Project, Regulatory Strengthening and Capacity Building Project, and Access Project.
The rest are Power Generation Sector Improvement Project and Energy Efficiency, and Demand Side Management Project,.
The Government of Ghana signed the Ghana Power Compact with the Millennium Challenge Corporation (MCC), an independent United States government agency, on the sidelines of the US Africa Leaders’ Summit in Washington on August 5, 2014.
Ghana to get over 498m dollars
Ghana signed the Power Compact with the United States of America acting through the Millennium Challenge Corporation (MCC), an independent United States government agency.
The Ghana Power Compact would provide Ghana with a grant sum of four hundred and ninety eight million, two hundred thousand United States Dollars (US$498,200,000) to improve the performance of Ghana’s power sector, unlock the country’s economic potential, create jobs, and reduce poverty.
About US$350 million of the grant is being invested in ECG to make the country’s power distributor operationally and financially more efficient.
Source: citi
