Ghana to lose $150m over ECG concession delays

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An energy think-tank in Ghana has raised red flags over possible loss of about US$150 million, if the country fails to reach a consensus on the Electricity Company of Ghana (ECG) concession agreement by September 2018.
The implementation of the concession was initially supposed to be effective this year but an arrangement by the previous government, has been extended to September, 2018. This is more than a year’s extension.

According to the executive director of Africa Centre for Energy Policy (ACEP), Ben Boakye , Ghana must be focused on securing the almost $500 million under the Millennium Challenge Account Compact II regardless the several distractions that have impeded the process in the last few years . 

However, Mr Boakye Agyarko, the Minister of Energy has reiterated government’s commitment towards the Ghana Millennium Challenge Compact II programme, particularly with regard to the Private Sector Participation in the Electricity Company of Ghana (ECG).

He said: “Despite the challenges that arose as a result of differences between stakeholders, particularly between labour, ECG and the Millennium Development Authority (MiDA), I wish to note that we are making good progress as the stakeholders make efforts to address their differences.”

“We have recently held the Bidders’ Conference to pave way for the shortlisted companies to submit
detailed proposals for the concession”.

Speaking in Accra at the luncheon of the American Chamber of Commerce (Ghana), Mr Boakye Agyarko said the stakeholder deliberations would continue to ensure the smooth implementation of the programme.

But energy policy think tank ACEP , says government is expected to work within a specific time frame and risk losing funds if there are further delays . 

Chief Executive Officer of MiDA, Owura Kwaku Sarfo said he is confident about the prospects of the Ghana Power Compact and its intended benefits to workers of ECG and Ghanaians.
Ghana has signed a US$498.2 million Compact II agreement with the MCC.
The Ghana Power Compact is expected to provide the country with a financial backbone to improve the performance of Ghana’s power sector to unlock the country’s economic potential, create jobs and reduce poverty ECG workers say government is in a rush to secure funds under the Ghana Power compact because of undue pressure from the United States of America. 

The Ghana Power Compact between the MCC and the Government of Ghana (GoG) was signed in August 2014, and disbursement was expected to begin in mid-2016 but was delayed due to protest from workers of ECG over possible retrenchment and the government not meeting the terms of the agreement. 

Government has amended the terms of the concession agreement by giving 51% ownership to Ghanaians and promised that workers would not be laid off. The duration of the concession has also been reduced from 25 years to 20 years
Source: Adnan Adams Mohammed

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