Government targets $1.9b savings in energy sector debts restructuring – President

The government intends to save more than $9.1 billion as part of the restructuring of power purchasing agreements over the life of existing independent power projects.

Delivering the State of the Nation Address to Parliament on Tuesday, President Nana Addo Dankwa Akufo- Addo announced that the government’s negotiating team had reached commercial agreements on headline terms for the restructuring of power purchase agreements and arrears.

The affected IPPs are AKSA, Amandi, Cenpower, CENIT and Early Power, the President said, adding that the negotiating team was also finalising remaining definitive documentation of the terms.

President Akufo-Addo said it was discovered during the negotiations that the reported debt of US$1.6 billion owed the IPPs was $1.2 billion, translating into savings of $400 million.

“In the meantime, ECG has been able to secure a fixed monthly energy purchase price with all the IPPs.

This has led to a monthly payment of $43 million, instead of $77 million, that is monthly savings of $34 million reduction in monthly payments, a far better outcome than the “Take-or-Pay” system we inherited,” the President said.

Independent power producers account for 47 per cent of the country’s total power generation mix and contribute 67 per cent of Ghana’s thermal power.

They comprise Sunon Asogli, Cenpower, Karpowership, AKSA, Twin City Energy and CENIT.

When contacted, Dr Elikplim Kwabla Apetorgbor, Chief Executive, Chamber of Independent Power Generators, said the Chamber would respond to the President’s statement at the right time.

Source: GNA