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Business News of Monday, 11 October 2021

Source: thebftonline.com

Unfriendly policies may cause 700 job losses - AGSI

Ignatius Baffour Awuah, Minister of Employment and Labour Relations Ignatius Baffour Awuah, Minister of Employment and Labour Relations

Unfriendly regulations and policies initiated by the government are stifling the growth of the solar energy industry, thereby making the country lag behind in the renewable energy drive, Secretary to the Association of Ghana Solar Industries (AGSI), Agyenim Boateng, has said.

Currently, there is a freeze on utility-scale solar projects and the government has directed that no private company must build or apply for a licence for utility-scale solar projects.

There is also an indirect government directive that stipulates no private solar company must construct a mini-grid, and that such projects must be government-led.

The Energy Ministry and Energy Commission will also have issues with the CNI sector, which includes factories, industries and bulk consumers of electricity if they choose to install solar for operations, the AGSI disclosed.

The AGSI further adds that there is also a current directive which states that no licence be issued to individuals who want to venture into solar energy engineering.

These and other policies, the association argues, have put over 700 jobs at risk in the sector – with some key solar energy companies leaving the Ghanaian market for Liberia and Sierra Leone.

“The association has 75 registered companies who are all affected by these decisions. So far, five members who are giants of the industry have exited Ghana to Liberia and Sierra Leone – and more are prepared to leave,” Agyenim Boateng told the B&FT.

Meanwhile, the current percentage of renewable energy in Ghana’s electricity supply mix is just about one per cent despite an abundance of prospects in the development of renewable energy resources including solar, wind, solid waste, geothermal, tidal and biomass.

Mr Agyenim Boateng, who was speaking at a solar energy engineering, procurement and construction (EPC) meeting hosted by Huawei and Jubaili Bros said: “The AGSI has been speaking to sector regulators through letters to the Energy Commission and Energy Ministry; saying that it doesn’t sit right for the government to prevent companies from reducing electricity bills by using solar as a means of carbon mitigation through non-issuance of licences.

“Since March this year, the AGSI has written to the ministry but our letter, as it stands, has not been acknowledged. These are barriers to the growth of the solar industry, and it’s a big problem for us,” Agyenim Boateng added.

Govt’s goal

While private solar industries are facing these challenges, the government has said it has a goal of increasing the level of renewable energy in Ghana’s electricity supply mix.

The government has missed its target of increasing the percentage of renewable energy into the country’s electricity supply mix to 10 per cent by 2020. The agenda was conceived in 2003 under the Ghana Renewable Energy Development and Management Programme (REDP).

The percentage of renewable energy in Ghana’s electricity supply mix is currently about one per cent, moving from 0.8 per cent in 2019.

Due to inability of the country to meet its 10 percent target, government has further extended the goal’s deadline to 2030.

But the unfriendly policies of regulators in the solar and renewables industry are casting further doubt as to whether the 10 percent target will be met even by 2030.

UN ratifications

Issues with climate change and global warming have made the use of solar and renewable energy more attractive, as renewable energy sources have been identified by the United Nations Framework Convention on Climate Change (UNFCCC) as key factors in reducing global warming.