ACEP supports privatization of ECG amid power distribution, revenue collection challenges

The African Centre for Energy Policy (ACEP) has thrown its weight behind proposals to privatize the Electricity Company of Ghana (ECG), citing the company’s inefficiency in ensuring the efficient distribution of power and its failure to address revenue collection and leakages.

Ben Boakye, Executive Director of ACEP, highlighted the dire state of ECG’s operations, stating that the company’s inability to collect revenue transparently has left it financially constrained.

“The bottom line is that there isn’t enough generation, and this arises because ECG’s collection is abused and not transparently utilized,” Mr Boakye quipped.

He argued that involving the private sector would not only revamp ECG’s operations but also make the company more accountable.

“The way to deal with it is to get the private sector in there, and that is the only way to make the Public Utilities and Regulatory Commission relevant,” he added.

ACEP’s Executive Director suggested that bringing in the private sector would help set targets to improve the financial position of ECG.

“ECG is not collecting enough revenue, ECG’s collection is abused therefore we do not get enough money to buy fuel. We should not walk away from those fundamental issues of lack of liquidity which is occasioned by ECG’s inefficiency to raise enough revenue to buy fuel to run the generators,” Mr Boakye emphasized.

The call for privatization comes on the heels of a suggestion by Asantehene, Otumfour Osei Tutu II, during the commissioning of a 430-kilometre natural gas pipeline by Genser Energy, aimed at bolstering the nation’s power sector.

However, not everyone agrees with the privatization proposal. Dr. Elikplim Kwabla Apetorgbor, CEO of the Independent Power Generators, Ghana, has debunked calls for the privatization of ECG, warning of significant risks to equitable access, affordability, and service quality.

Dr. Apetorgbor rather called for a review of the governance structure of ECG to make it more profitable and sustainable.

“The strengthening of the governance structure of ECG and the sector as a whole including representation on the board of ECG, public ownership, regulatory oversight, and community engagement for responsible consumption to achieve sustainable electricity provision is what is needed and not privatization (sic),” he remarked.

The debate over the privatization of ECG underscores the challenges faced by Ghana’s power sector and the diverging opinions on how best to address these issues. While ACEP supports privatization as a solution to ECG’s inefficiencies, others argue for a review of the company’s governance structure to improve its profitability and sustainability.

The government and stakeholders must carefully weigh these perspectives to determine the most effective path forward for Ghana’s power sector.

Source: Norvanreports