THE AKUFO-ADDO/BAWUMIA GOVERNMENT AND ECG MUST TAKE URGENT AND PROACTIVE STEPS TO REDEEM ITS INDEBTEDNESS TO SUNON ASOGLI POWER LIMITED
It is very retrogressive and disheartening to learn about the indefinite shutdown of the 560MW Sunon-Asogli Thermal Plant by Sunon-Asogli Power Limited, a major player in the country’s power sector.
I have come across a statement issued by the Company which cites a host of reasons including protracted delays in payment of invoices, and what it describe as “unproductive engagement” to resolve government's outstanding to them.
This unfortunate but unsurprising development is indicative of the gross mismanagement that has plagued the energy sector under this Akufi-Addo/Bawumia-led NPP government.
The once-thriving energy sector bequeathed to the Akufo-Addo/Bawumia government has now been thrown into complete disarray due to gross management of the sector.
One of the contributing factors to the power crisis is the continuous mismanagement and misapplication of the Energy Sector Levy Act (ESLA) , which was introduced by the previous NDC government to address energy sector debts.
The erstwhile NDC government led by President Mahama in its determination to strengthen the financial base of the power sector, promulgated a special purpose vehicle called the Energy Sector Levies Act (ESLA) in 2016 to deal with the energy sector legacy debts by raising long-term bonds in addressing the financial challenges facing the sector, particularly in debt management.
While in opposition, the NPP labelled the ESLA as a nuisance tax and promised to scrap same when they win political power. However, after assuming the reins of government in 2017, not only has this Akufo-Addo/Bawumia NPP government increased the ESLA levy, but this government has collateralised ESLA for fifteen (15) years to raise monies which they have
misapplied, thus defeating its original purpose and eroding the gains made in settling all legacy debts in the sector. This has further exacerbated the financial instability of the power sector.
The current state of the Electricity Company of Ghana (ECG) is disquieting and of grave concern.
ECG, which plays a crucial role in providing reliable supply of electricity to consumers, is unfortunately suffering from monumental mismanagement and inefficiency under the current administration.
The repercussions of the mismanagement of the energy sector are far-reaching. The debts keep piling up by the day, as the threat of a power crisis continues to loom large.
It is therefore imperative for the Akufo-Addo/Bawumia NPP government to demonstrate humility and leadership in engaging with the Independent Power Producers (IPPs) in order to address the imminent catastrophic power crisis.
It is quite troubling for an IPP to produce power all year (January to December, 2023) and get paid for only 24% of its invoices. No IPP can operate viably and sustainably under these circumstances. Already, due to the announced shutdown of the Sunon-Asogli Power Plant alone, parts of Accra were plunged into darkness last night. The earlier this government took steps to honour its obligations to IPPs, the better it will be for all of us.
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