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Business News of Tuesday, 12 February 2013

Source: B&FT

Ghana should forget about exporting energy- Wereko-Brobby

Former CEO of the Volta River Authority Dr. Charles Wereko Brobbey has asked government to abandon completely the idea of making Ghana a net exporter of power in the near-future and focus on meeting domestic demand.

“Where from all this thing about becoming a net exporter of power? It is irrelevant, it is diversionary, and is taking us away from the fundamental detail...,” he said at the John Kofi Turkson Memorial Lecture, where he spoke about the country’s energy situation.

“The first time I heard Dr. Joe Oteng Adjei [former Energy Minister] talk about it, I called him up and said don’t say this thing, you don’t have enough energy...It should never be part of our discussion, especially when we cannot meet the energy needs of our country,” he stressed.

Even as the country struggles to meet local energy demand, amidst constant power outages and load-shedding exercises, assurances have come from government that in the next few years the country will become a net exporter of energy.

President Mahama himself has on a number of occasions stated this position. As Vice President, he said in December 2011 at the ‘Power Summit’ that government plans to develop an energy economy and become a net exporter of power by 2015, through an increase in the current generation capacity of 2,000 megawatts to about 5,000 megawatts.

When he met the Ghanaian community in Abuja, Nigeria, as part of a three-day ‘Thank You Tour’ of some West African countries in September 2012, the president repeated the country’s energy vision of becoming a net exporter of power to neighbouring countries.

He mentioned some of the measures as completion of the Bui Hydro-Electricity programme which is expected to produce about 300 megawatts, and the development of the Jubilee Field gas project that is expected to produce between 600 and 700 megawatts.

President Mahama said: “We shall also develop wind and solar energy in some areas as a supplement to the hydro-electricity we have in Akosombo and others.”

Dr. Wereko-Brobby said, however, that the politicians are only touting what the Energy Commission has written for them as the energy vision of the country.

“So here we are: in the midst of this whole thing of what are we trying to get energy for, people are confusing the need to sustain it, and bring value to our own development with trying to compete with the Minerals Commission or Cocobod to see whether we can make money out of it.”

At the heart of what Ghana needs for its development, he said, is the sustainable provision of energy resources, and the country cannot afford to lose sight of that.

Demand for power in the country is said to be increasing almost as fast the country’s economic growth rate. When the country’s economy grew by over 14% in 2011, the demand for power also grew by 11%.

In a recent memorandum to Parliament toward vetting the Energy Minister designate, the Africa Centre for Energy Policy (ACEP) expressed doubt about the estimate of 450MW expected to be added to generation capacity by the end of 2013, saying it will still be lower than the current total power shortage of 600MW -- including a reserve margin of 20%.

Beside the generation issues, there are system problems and inefficiencies, including high Transmission losses of 5% and distribution losses at 28% ACEP said, adding that the need to invest in system expansion and efficiency cannot be overemphasised.

“We recognise that Government does not have the resources to meet the estimated investment requirement of US$4.7billion for the energy sector. This is needed to increase or upgrade the power infrastructure, for which about US$200-280million of investment is required in generation annually. The need to attract private sector investment is therefore very critical for the power sector.”

Government, however, remains confident about meeting local demand and even exporting the surplus. The Energy Commission says, for instance, that the country can achieve sustainable energy for all by the year 2020.