Ghana's Vice President, Dr Mahamudu Bawumia, has acknowledged the significant impact that existing PPAs has on the country's energy sector. Speaking at Joy News' 100 days Town Hall meeting in Accra Monday, the VP said that government’s review of 20 previously secured power purchase agreements (PPAs) has strengthened the energy sector.
My Joy Online reported that the secured PPAs has already saved the country $300 million through the cancellation of agreements and review of four others.
According to Bawumia, this has "helped to reduce government expenditure."
Ghana turns around energy sector
At his first State of the Nation Address in February, President Nana Addo Dankwa Akufo-Addo disclosed that the energy sector owed its private partners a total sum of $2.4 billion as at December 2016. Read more...
According to the President, of this amount $800 million was owed to local banks.
With efforts to restore balance, the President said he would review 43 Power Purchase Agreements (PPA) entered into by the Electricity Company of Ghana (ECG) in 2016, media reported.
My Joy Online reported that former President John Mahama endorsed a $1 billion power deal with Early Power Limited expected to last for about two decades.
In addition, Turkey-based Karpower signed with ECG in June 2014 that will feed 450MW of power into the national grid.
My Joy Online reported: "A 17-member committee set up to review one of the agreements, AMERI Power Agreement, revealed the deal was overpriced by $150 million, although former government officials have challenged it.
"The Philip Addison Committee has suggested to government to have the deal renegotiated to cut down the cost.
But 100 days after taking the sacred oath to protect the Constitution and drive prosperity, the Vice President said they have recorded more than 103 achievements."
They added: "He listed the review of the 20 PPAs, restoration of the teacher and nursing trainees allowances cancelled by the past government, giving clearance for the payment of new National Service Scheme (NSS) allowance from GHC350 to GHC559 and employing 11,000 nurses who have been home two years after school as some of the government's achievements."
Noting that the country's foreign reserve has been bumped up from $6 billion to $8 billion, Dr Bawumia said:"With this achievement, you have a lot more confidence in the economy and you see stabililty return to the currency [cedi].
"When we came in, the cedi was running but essentially we have arrested it and the Inspector General of Police (IGP), David Apeatu has the keys. He has locked it up." Read more...