A flagbearer hopeful of the New Patriotic Party (NPP) and Energy Analyst, Kwadwo Poku has raised concerns about the debt challenges facing Ghana’s energy sector, emphasizing the need for increased commitment and attention to resolving the issues in the sector.
He made this known in an interview with Accra-based Joy News which was monitored by GhanaWeb.
In the interview, the flagbearer raised concerns about the government’s decision not to provide guarantees or engage in take-or-pay agreements but to engage in take-and-pay with new investors.
This strategy, he believes, may deter potential investors, except for the existing companies already operating in the country.
“I wouldn’t say there is no commitment because the Ministry of Finance has been doing some work. But you see, it’s a multifaceted problem. Now that we are talking about generation, one of the biggest problems is also fuel. The availability of gas to power these generating plants. You need money to pay the existing Independents Power Producers (IPP) that you owe. One of the problems we’ve put ourselves in as a nation is coming forward to say that going forward, we will not give out any guarantee and wouldn’t do any take or pay, we will do take and pay, which means that come and build your plant, we won’t give you any guarantee as and when you produce then we pay you. No investor is going to do that. The only ones who are planning to play around with that theory are the existing companies who are already here. The problem you have with the existing companies is that we procured the initial PPAs from them at a very expensive cost. So, when you are now negotiating with them, you are negotiating from a very down Power Purchase Agreements (PPA). So, you will look at it as though this is cheaper, no it is not. Because where you are coming from, you should have been there in the first place. So, there is commitment but there isn’t enough commitment,” he said.
He went on to explain that the issue of non-payment to existing IPPs makes it difficult to attract new investors.
“The situation that we find ourselves where we are not paying the existing IPPs, it makes it difficult for new entry to come and put their monies into the energy sector without giving them the guarantee that they need.
The flagbearer hopeful Kwadwo Poku, further stressed the need for heightened commitment from the government to the issues in the energy sector effectively.
“We now find ourselves in that position of fuel scarcity where we might not have enough natural gas for all these plants that are to come on. So, it is a problem that needs 120% attention. Now we are giving it about 50% and I think there should be more that needs to be done,” he added.
Source: Ghana Web
