Government engaging IPPs over GHC1.5b ECG debt

Government has begun engaging Independent Power Producers (IPPs) over the 1.5 billion dollar debt owed the producers by the Electricity Company of Ghana.

On Monday the IPPs issued a statement threatening to shut down power plants and plunge the country into darkness if the amount was not paid in time.

The IPPs currently generate about 2,600 MW which is about 60 percent of the total generation in the country’s power sect.

Government has however continued to blame the Mahama-led administration for incurring energy debts over un-used power.

Detailing moves being made by government to settle the debts in a media briefing, Information Minister Kojo Oppong Nkrumah said the finance and energy ministries have begun meeting the power producers to address the concerns.

“You recall we had the opportunity to speak extensively about how much the take or bail contracts are costing us. In 2019, when we did the mid-year review and we had to request for 6billion cedis extra, about 5 billion cedis of that is going to pay for energy that we literally are not using. The overcapacity that was contracted by the previous administration.”

He explained on “now those contractual obligations are such that when you do not pay, whether you have consumed the power or not, the IPP’s will threaten that they are doing that. It’s a contract, you have to either turn in the contract or you have to pay what you are obliged to pay.”

He noted that government has taken note of comments the IPP have made for what has been incurred already adding that government will have to dispatch pay.

“The ministries of finance and energy are engaging with them on how to bring some resolution to that. Within the ambit of the negotiations that are still ongoing at this point in time,” he indicated.

Oppong Nkrumah added “our interest is that your lights don’t suffer at home even while we cure the challenge that we inherited with the energy sector. And between the ministries of finance and energy they will do well to ensure hat that us executed.”

Meanwhile former VRA boss Dr. Charles Wereko Brobbey has asked that the ECG be listed on the Ghana Stock Exchange.

The Africa Center for Energy Policy has also recommended that government initiates a new concession process outside the MIDA framework.

Source: Ghana/otecfmghana.com