Sunon Asogli Denies Receiving Promised $30M amid Debt Crisis

Independent Power Producer (IPP) Sunon Asogli Power Ghana Limited has categorically denied receiving any part of a $30 million payment that the Ministry of Finance claimed it directed to be released by the Controller and Accountant General’s Department (CAGD).

Despite prior government assurances, the power company asserted that no funds have been disbursed, adding to a strained relationship between Sunon Asogli and the Ghanaian government amidst a financial impasse with the Electricity Company of Ghana (ECG).

In an interview, Dr. Elikplim Apetorgbor, the Business Development Manager of Sunon Asogli, offered an in-depth view into the complexities surrounding the government’s promise of payment.

“We received notification from the Controller and Accountant General’s Department in the first week of our shutdown.

“They informed us that the Ministry of Finance authorized them to pay us $30 million. But they are having some challenges.”

Dr. Apetorgbor further explained that the Ministry’s payment was supposed to be split into five or six tranches, to be disbursed incrementally beginning in the week of salary payments, with the full amount intended to be settled by the end of October.

Yet, as of early November, Sunon Asogli has not received even one tranche, casting doubt on the government’s commitment to fulfilling its financial obligations to the power producer.

Sunon Asogli Power Ghana Limited has been one of the key players in Ghana’s energy sector, providing critical power supply to bolster the nation’s electricity demands.

However, it has been grappling with financial instability due to unpaid bills, with ECG owing the company an outstanding $259 million.

This debt, accumulated over time, has rendered it increasingly difficult for Sunon Asogli to maintain operations, eventually forcing the company to take the drastic measure of shutting down its facility temporarily.

The delay in payment has exacerbated the financial strain on Sunon Asogli, impairing its operational capacity and overall financial stability. The company, which relies on steady revenue to fuel its operations, is struggling to maintain the power plant and meet the operational costs necessary to sustain its 560MW power generation.

Dr. Apetorgbor pointedly criticized the Ministry of Finance for what he described as a failure to uphold its responsibilities.

“It is unfortunate the Ministry of Finance has been reduced to an official propaganda office. It is such a sensitive office to be used for that.

“I will advise that whatever information the finance minister provides or shares with the public, kindly double-check to ensure that you are dealing with the right information.”

The IPP’s shutdown decision has cast a shadow over the availability and reliability of power supply in Ghana. Sunon Asogli’s 560MW power plant represents a significant portion of the national grid, and any prolonged inactivity threatens to disrupt power stability, affecting industries, businesses, and households.

If payments continue to be delayed, further shutdowns from other IPPs could follow, as several IPPs are reportedly facing similar challenges with ECG debt accumulation.

The situation underscores longstanding issues within Ghana’s energy sector, especially the financial struggles between state agencies and private power producers.

ECG, tasked with collecting revenue from consumers, has historically struggled with inefficiencies and an inability to fully recover funds, leading to debts owed to IPPs.

The denial by Sunon Asogli Power Ghana Limited of receiving the promised $30 million from the Ministry of Finance serves as a stark reminder of the broader issues afflicting Ghana’s energy sector.

The prolonged debt issue between ECG and IPPs not only threatens the operational stability of companies like Sunon Asogli but also jeopardizes the nation’s power infrastructure, leaving Ghana vulnerable to potential energy crises.

Moving forward, a more structured, transparent, and reliable financial management system between government agencies and private power producers is essential to prevent similar situations and ensure sustainable energy solutions for Ghana’s future.

By Leo Nelson || Ghananewsonline.com.gh