ECG to merge with NED

Accra, Oct. 31, GNA- The Electricity Company of Ghana (ECG) and the Northern Electrification Development (NED) are set to be merged under a proposed programme expected to stimulate efficiency in energy distribution and quality in service delivery.

The Ministry of Energy, which announced the merger says it would re-organise the new company into four Strategic Business Units (SBU) operating under a single Holding Company. The four Units would be constituted as the Northern, Central, Western and Capital Electric. The SBU's, would eventually be spun into fully fledged companies within the ambit of the Holding Company, as a direct means of deriving maximum benefits of the energy sector reform programme, Deputy Energy Minister Kwame Ampofo Twumasi announced on Wednesday. He was opening a three-day National Energy Symposium in Accra. The symposium is under the theme: "Energy Sector Reforms: Removal of Policy Implementation Barriers", and aims providing a platform for discussing barriers to the implementation of the reform in the power sector and identify concrete measures for assuring adequate power security for the future.

It would also provide the opportunity for stakeholders to review the development of the energy sector since 1983 in terms of planning and achievements.

A key expectation of the reform programme is to improve the operations of the electricity distribution companies. The symposium is a platform for unearthing young scholars and professionals to attract them to the energy sector. Mr Twuamsi said the decision to implement the power sector reforms, that were taken over a decade ago, had been characterised by contradictions and stagnation.

He said even though the regulatory institutions had been established since 1997, the process of putting in place and implementing the requisite standards had been constrained, posing high system losses to the utility companies.

He stressed the urgent need for the acceleration of the reformation of the power sector, noting that the attainment of a reliable electricity supply in Ghana would be illusive if stakeholders do not embrace reforms in the sector. Mr Twumasi said the Ministry was taking expeditious steps to advance the energy reform goals.

This would include the increase of private participation in the electricity supply industry, unbundling the Volta River Authority, improvement within the distribution sector, implementing economic and full cost tariffs and the development of competitive wholesale electricity supply market.

He said the Ministry would encourage and create the conducive environment for increased private sector investment and operation of the power supply infrastructure either as wholly private-owned initiative or as a Public Private Partnership

The Deputy Minister said that as a necessary complement to the restructuring of the ECG, the Ministry would also support the implementation of the policy of full cost recovery in electricity pricing as envisaged under the reform programme. The Ministry, he said, would however pursue the objective in a gradual manner in order not to over-burden consumers. He noted that the business of electricity generation, transmission and distribution was an expensive venture, and the escalating prices of crude oil and petroleum products which are the primary fuels for thermal power generation had not helped the situation.

From a proportion of zero in Ghana's electricity supply mix, as recently as 1995, thermal generation within the past year constitute about 70 percent of the electricity generation mix. The Minister asked Ghanaians to brace themselves against higher cost of electricity supply, as the proportion of more expensive thermal generation sources would grow.

"We cannot avoid paying higher tariffs if we are to brace ourselves against the unfortunate situation we were in during the load shedding period. This means that consumers will have to adopt more stringent conservation measures to lower their bills." He re-echoed government's continued commitment to reform the power sector.

Finance and Economic Planning Minister, Kwadwo Baah-Wiredu, in a speech read for him called for more collaborative working relationship among all stakeholders in the energy sector to overcome the shortcoming besetting the sector and to take strategic and financial decisions to fund necessary improvements before another crisis erupts. He entreated Ghanaians to contribute their quota by using power wisely or investing in the energy sector to ensure improved living standards. 31 Oct. 07