The government says it has saved in the energy sector over $5 billion by relocating Karpowership Ghana Company Limited (Karpowership) and securing agreements with CENIT Power Limited (CENIT) and Cenpower Generation Company Limited (Cenpower), with more savings to come.
It also says it has paid in excess of $1.0 billion to Independent Power Producers, adding, this is on top of the GH₵2.7 billion paid by Electricity Company of Ghana Limited.
In a statement from the Finance Ministry captioned: ‘Dumsor will not return: Government of Ghana saves Energy Sector $5 billion as it continues to deliver on the Energy Sector Recovery Programme’, the government said it has continued to improve the Energy Sector Recovery Programme and will make further announcements soon.
It also welcomed the collaboration and commitment shown by the IPPs and called for their support in bringing the negotiations to a swift close, adding, the energy sector in Ghana is faced with a number of challenges.
“Many of these issues were inherited by this government from the previous administration. While attempting to provide emergency power to address a spate of persistent load-shedding which crippled businesses and adversely affected GDP growth, the previous government signed contracts with IPPs in an uncoordinated and non-competitive manner.
“Consequently, today, Ghana pays over $500 million a year in excess capacity payments that is payment for power that it simply does not use or need. Despite the challenges, this government has prioritised making payments to the IPPs to reduce the debts”, it emphasised.
Furthermore, the statement said the government had committed to building an energy sector based on long-term energy security, sustainable investment, and partnerships to bring affordable accessible energy to the people of Ghana, in line with the vision of a Ghana Beyond Aid.
To achieve this vision, it pointed out that it has taken pragmatic and decisive action to manage the energy sector, stressing “in collaboration with the World Bank, government established the ESRP, identifying the policies and actions needed for financial recovery in the energy sector over a five-year horizon (2019-2023).”
It concluded, saying “the Government Negotiating Team, established under the Energy Sector Recovery Task Force, which is helmed by the Senior Minister, is working bilaterally with IPPs and Gas Suppliers under the ESRP Consultation Process, to secure more favourable and sustainable agreements for both parties.
“As any nation’s energy sector matures it is standard practice to undergo such reform and restructuring processes.”