Executive Director of the Africa Centre for Energy Policy (ACEP) Ben Boakye has attributed the issues that have resulted in the threat by the Independent Power Producers (IPPs) to cut power supply by July 1 to poor delivery of plans and roadmaps in the energy sector.
He stated that although measures had been put in place to deal with some of these issues, those measures were poorly executed by the stakeholders, especially the government.
For instance, he said, revenue collection measures of the Electricity Company of Ghana (ECG) were scaled up however, ECG has only managed to collect only 11 percent of the debts.
He described this as disastrous.
Speaking on the Ghana Tonight show on TV3 with Alfred Ocansey on Thursday, June 29, Mr Boakye said “Essentially, it is the result of poor planning, poor delivery of actions and roadmaps to be able to address the concerns. We always knew that this kind of situation would happen as far back as 2014.
“We started putting in place measures to reform the energy sector, particularly the distribution sector. That is how the MCC programme actually came to be because America was giving money and we decided that among all the sectors of our economy, energy was paramount and therefore we wanted to invest the $500million to reform the energy sector and a chunk of that was to go into reforming ECG to be able to deliver on its mandate and be effective at that.
“So over the years that plan has jolted and failed to deliver as planned and that is what is deepening our problems today and it has gotten worst. If you look at the data, everything suggests that it is getting worse by the day. I am looking at revenues that were collected between March and April which actually show that revenue requirements, we could only meet about 11 percent of the revenue requirements from the ECG’s collection and that essentially is very disastrous for the sustainability of not just the energy sector but the economy in general. Because if ECG fails to pay the government has to pay and that is part of the agreement that we had with the IPPs that are actually generating power.”
The IPPs had said they would not be in a position to continue the generation of electricity.
They said their earlier request to the Finance Minister to pay an interim 30 percent of their arrears to enable them to continue to operate has not been heeded by the Ministry.
“We refer to our letters dated March 27, 2023 and May 25, 2023 with reference numbers IPGG/1/2023 and IPGG/2/2023 addressed to the Minister [Finance] by which the IPP Chamber stressed the urgent necessity for the government to prioritise payment of the outstanding arrears owed to members of the IPP Chamber to enable the IPPs to cover critical operational costs required to continue operations and pay overdue debt service”, the said in a statement to the Finance Minister.
The statement added “We had indicated in our letters that IPPs needed to receive an interim payment of 30% of the outstanding arrears of each IPP by 20th June 2023.
“Unfortunately, we have not seen any good faith indication or commitment of such impending payment from ECG/Government as of today, June 21, 2023, despite the Electricity Company of Ghana’s recent collection efforts, as reported in the media, which yielded circa ¢3.1 billion.
“At an emergency meeting of the IPP Chamber held on Tuesday 20th of June 2023, it was resolved that unless the IPPs receive the interim payment requested by the 30th June 2023 the members of the IPP Chmaber will not be in a position to guarantee the continued generation of electricity after 30th June.”
The post IPPs debt: Poor delivery of actions in energy sector caused the issues – ACEP appeared first on 3News.com.
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