Ghana’s energy sector faces some challenges, including legacy Power Purchase Agreements (PPAs) which see the country pay billions of US dollars for electricity it cannot use.
Dr. Matthew Opoku Prempeh, the Minister of Energy Minister has revealed that the government led by President Nana Addo Dankwa Akufo-Addo made total savings of $2.761 billion in the energy sector.
He made reference to the Project Light, which is aimed at renegotiating PPAs.
The agreement entered into under the previous government during the power crisis is to ensure that Ghana obtains value for money on all agreements as well as the renegotiation of Gas prices from the Sankofa Fields.
Briefing the media on the energy sector under the topic ‘Delivery Reliable and Affordable Power’, Dr. Opoku Prempeh said concerning the over 46 PPAs signed by the previous government with Independent Power Producers (IPPs), the government managed to get some of the agreement deferred adding that the savings that have been made on the deferment of agreements of Early Power, Jacobsen Power Ltd and Rotan are significant and sets the tone for a more sustainable energy sector financial management framework.
He said “We have made savings on deferment of 3 PPAs amounting to $1.426bn since 2019” amounting to $475.50m per deferred PPA.
The Minister said the total saving was sufficient to build 62 stadia the size of Tamale Stadium adding that in addition to other savings, a total of $1.335 billion brings the total savings to $2.761bn in the energy sector.
He stated that the government is committed to ensuring long-term financial sustainability in Ghana’s power sector.
He disclosed that the Energy Sector Recovery Programme approved by the government has saved the country’s energy sector $5billion.
In 2020 alone, the government paid over US$1 billion to Independent Power Producers. This is on top of GH¢2.7 billion paid by the Electricity Company of Ghana (ECG).
