29 June 2010 – The World Bank has approved an additional amount of US$70 million for the Electricity Company of Ghana (ECG) under the Ghana Energy Development and Access Project (GEDAP), to enable the company to scale up its distribution system improvement and loss reduction activities.
In particular the new activities will be focused in the Ashanti region, with a special focus on Kumasi and its vicinity, and will include the installation of prepaid meters as well as upgrades to the distribution system.
About 346,000 of ECG’s customers in the Ashanti region are using credit meters. However, meter tampering, electricity theft, meter reading errors, and payment arrears have led to high commercial losses by ECG in that area. Indeed at 32 percent the Ashanti region has the highest energy losses amongst ECG’s operational areas.
The new investments are aimed at reducing the system losses in the region to about 22 percent, and to improving revenue collection. To this end approximately 140,000 ECG customers (mainly residential) will have their credit meters replaced with split-type prepaid meters, while a further 14,000 new customers will be provided with prepaid meters. In addition, to bring ECG closer to its customers, the company will construct five additional district offices and two new customer service centers in the region.
Other activities will include finalizing the 11 kV and 33 kV network mapping in the Ashanti region using GIS in order to effectively measure the losses in the distribution network, acquiring distribution materials and equipment to further improve the 11 kV and LV networks, constructing a 33/11 kV primary substation at Anyinam, Ashanti West to meet the growing demand, and constructing new lines and feeders to improve the reliability of supply in the Kumasi metropolis.
“It is the hope of the Bank that this additional financing will be utilized with dispatch to minimize electricity outages, and we also hope that this can help further increase access, in deprived areas, to reliable electricity,” said Ishac Diwan, World Bank country director for Ghana.
The funding, which will be provided by way of a loan to the government of Ghana, is additional to the first GEDAP, which was approved in 2007 to improve the operational efficiency of the electricity distribution system and increase the population’s access to power and to help transition Ghana to a low-carbon economy through the reduction of greenhouse gas emissions.
In 2008, Ghana’s electrification rate reached 59 percent, significantly higher than the average of 28.5 percent of sub-Saharan Africa, although in the rural areas the access was only 23 percent. However, losses in the distribution network are about 25 percent due to poor quality of electricity supply and operational inefficiencies as a result of inadequate investment and preventive maintenance.