You are here: HomeNews2017 04 05Article 525734

Business News of Wednesday, 5 April 2017


Analysts intensify resistance to ECG concession

At a time government is considering plans to cede part of management of the Electricity Company of Ghana, some players in the industry have renewed appeals against the move.

They argue that the plan if approved will have minimal impact in turning around ECG’s inefficiencies. About 350 million dollars out of the total 500 million dollars compact is expected to be channeled into the modernization and reduction of commercial losses by the ECG.

Though the NPP government is reviewing the deal, some analysts want a complete cessation of any private sector participation in the power company. The Campaign Coordinator for ISODEC, Dr Steve Manteaw explains that ECG could be efficient if issues of investments, efficiency and accountability are critically addressed.

“ECG has not been able to invest in its operations largely because of government’s huge indebtedness. The company is today inefficient partly because of power theft and largely because of absolutely inefficient equipment and if it is not able or government does not pay what it owes ECG how on earth can ECG invest in its operations”. Another major challenge according to Dr Steve Manteawis the interference of politics in appointing heads of the Electricity Company of Ghana. “When you get into a situation where we politicize the appointments of heads of ECG, how else do you expect it to be accountable to Ghanaians?

They become accountable to the political parties that appointed them and not Ghanaians so the question is whether concession is the way to address the problems confronting ECG and I say we have done it before and it did not work.” In September 2016, MiDA announced that the Ghana Power Compact, also referred to as Compact II, has now entered into force. This means that the treaty signed on August 5, 2014 between the Republic of Ghana and the United States of America, represented by the Millennium Challenge Corporation (MCC) has become effective and Ghana now has access to the program funds.

Announcing the commencement of the Compact, the Chief Executive Officer of MiDA, Ing. Owura Sarfo said, “I am happy to advise that yesterday we met all the conditions precedent to entry into force of the Compact and submitted all the required documentation in that respect”.

Under the Power Compact, six projects namely ECG Financial and Operational Turnaround Project, NEDCo Financial and Operational Turnaround Project, Regulatory Strengthening and Capacity Building Project, Access Project, Power Generation Sector Improvement Project and Energy Efficiency and Demand Side Management Project, will be implemented to address the root causes of the unavailability and unreliability of power in Ghana.