NPP Lacks Coherent Energy Policy -EIU

–ECONOMIST INTELLIGENCE UNIT

The influential "Economist Intelligence Unit (EIU) newspaper of the UK has lambasted the NPP Government of lacking a coherent energy policy and explained that this is largely responsible for the crisis in the electricity sub-sector in the country.

In its May 2007 edition, the E.I.U chastised the NPP Government for not using the Osagyefo Barge which could have produced 110-125 mw OF electricity, 2 pooh-poohed the NPP Government’s suggestion of a nuclear option for Ghana.

The full assessment of the NPP Government induced energy crisis as published by the EIU is reproduced below. Now read now--- The power shortages that have blighted Ghana throughout 2007 (February 2007. The domestic economy: Infrastructure) have worsened, and in response the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG) have extended compulsory load shedding. As part of the new load-shedding guidelines, the energy-intensive Volta Aluminium Company (VALCO) has been forced to shut down its operations entirely. Other business, including those in the mining sector, have already been asked to reduce their consumption by 25%. In March, the chief executive of the VRA, Joshua Kofi Ofedie, said that he believed severe shortages would last through to the end of June, when the main rainy season in the Volta region should begin and water levels at the Akosombo dam start rising. However, he said that shortages are highly likely to continue into August. Mr Ofedie went on to explain that the VRA is producing 6, 611 gwh against a demand of 10, 152 gwh, leaving a shortage of 3,541 gwh.

The latest and most controversial suggestion put forward by the government for the long-term resolution of the energy crisis is for it to develop a nuclear energy-generating capacity. The Ghana Atomic Energy Commission (GAEC) argues that it would take US$3-5bn to construct a nuclear power station and has been in discussion with the cabinet over such a project. The GAEC further argues that operational and maintenance costs would be lower than those for hydro-power and that Ghana would be able to store up to 15 years supply of fuel to run a reactor. However, given that the technology and financing for such a project is not available domestically, an unprecedented amount of diplomatic effort will be needed to persuade the international community that a country that has difficulty maintaining its present rudimentary power production and transmission should be given access to such potentially dangerous technology.

The only other nuclear reactor in Sub-Saharan Africa outside of South Africa, in the Democratic Republic of Congo, sets a bad precedent. A March report by the International Atomic Energy Association underlined its earlier findings that only 10% of internationally recognised protection measures and normal practices were in place at the Kinshasa reactor, although it is no longer operational. The government’s strategy has been inadequate It is clear that the government’s lack of a coherent policy to meet the rising demand for energy is partly responsible for the current crisis. A number of other possible measures, such as building a sea-water reverse-osmosis desalination plant, are being considered but are not expected to make any headway. Shorter-term measures such as buying electricity from neighbours have also floundered for technical reasons. However, although not as grandiose and visible as some of the other ideas, by maintaining existing electricity networks more effectively the government could reclaim the 25% of Ghana’s electricity production that the VRA admits is lost through operational inefficiencies. In addition, even given the lack of production capacity inherited by the New Patriotic Party (NPP), the worst effects of the crisis might have been avoided, if existing projects had been managed more efficiently. The Osagyefo barge, which has the capacity to produce 110-125mw of efficiently, remains unused even though it was finished over four years ago. A more effective energy policy is required to avoid such problems in the Future. For the longer term, the country will need to invest in more orthodox solutions to the problem than the nuclear option, such as the Bui Dam project and larger thermal plants that can use gas provided by the West African Gas Pipeline.