It is quite challenging to comprehend the government’s management of the power sector, particularly with the recent power outages experienced in the country. The situation reached a critical point during the Stadia Africa Games events at the Cape Coast Sport Stadium, plunging it into darkness. Even the recently passed Parliament House suffered a total blackout. This unfortunate turn of events is disheartening, considering the significant investments made by the past president, John Dramani Mahama.
During an interview on the Adekyee Mu Nsem morning show on Ahotor 92.3 FM, hosted by Citizen Kofi Owusu, the Member of Parliament for Wa Central, Abdul-Rashid Hassan Pelpuo, expressed his concern. The power sector is burdened with a substantial debt portfolio with Independent Power Producers (IPPs), negatively impacting the consistent power supply.
The government appears to struggle with efficiently managing the sector, facing issues of corruption and mismanagement. There is a lack of commitment to improving upon the substantial investments made by the previous government. Rashid Pelpuo emphasized that the country has an installed generation capacity of 2,450 mega-watts (MW), including 546 MW from IPPs. However, the actual availability seldom exceeds 2,000 MW, serving a population of 25 million, growing at a rate of 2.1% per year.
Despite former President John Agyekum Kufour’s efforts, there has been minimal improvement, with only a 3% increase in power capacity. On the contrary, the National Democratic Congress government, under John Dramani Mahama, significantly increased power capacity by about 44%, addressing the situation inherited from the New Patriotic Party (NPP).
The NPP government’s inability to find a solution to the aging high-voltage transmission system is evident. The majority of Ghana’s transmission infrastructure was built decades ago and has not been significantly upgraded since then, resulting in several total system collapses in recent years.
Ghana’s electricity sector is undergoing a transition, aiming to attract more private sector participation. Independent Power Producers are entering the market, challenging the previously dominant public sector. However, challenges persist, including demand surpassing supply, poor transmission and distribution infrastructure, and tariffs insufficient to cover costs.
The severe electricity rationing in 2016-17, known as “dumsor,” led the government to hastily grant several generation licenses to IPPs, committing to high prices through long-term agreements. Unfortunately, this approach resulted in over-supply, and Ghana is now paying over 500 million USD annually for unused power.
Key lessons learned include the need for flexible contracts, protection against currency risks, transparency to address corruption, and avoiding political expediency in decision-making.
Contact Information:
AYM Kukah
Email: kukahalexander7@gmail.com
