Ghana On Course To Solving Energy Problems

For more than a decade now, Ghana has experienced intermittent power supply which have sparked great concern over the state of the country’s energy sector without the likelihood of any imminent solution to the country’s energy needs.

As the country grows into maturity, transitioning in the process from a low income to a middle income country, its power grid must similarly undergo change. Until now, Ghana has depended on hydro power generation and has struggled to overcome the associated hydrological shocks.

This constraint, coupled with accelerated population growth, further industrialization of the country’s economy and changing electricity consumption habits has driven the demand for power beyond its current supply. It is clear that Ghana is sorely in need of compelling alternative sources of power.

According to the statistical data recorded from Research and Markets, from the year 2000 to 2009, residential demand for electricity had risen by 61 percent, driven by rapid urbanization and high economic growth. This has been directly influenced by the growing trend towards urbanization.

About 52 percent of Ghana’s population currently lives in cities (up from 42 percent in 2000), where energy consumption as a whole is sufficiently higher than in rural areas. Furthermore, industrial demand for power has, over the same period, grown by well over 64 percent, driven largely by continued growth of the mining sector as well as growth of the nation’s oil and gas sectors.

The statistics tell an unmistakable story: as the country and its many key sectors rapidly evolve, the strain on Ghana’s power grid will only increase.

The critical nature of these indicators had raised concern, among those within the country’s borders and internationally as well. The 2013 World Bank report titled “Energising Economic Growth in Ghana: Making the power and petroleum sectors rise to the challenge” established that Ghana’s energy sector was performing below expectation. The report called on the Ghana government to fix the problems in the sector so as to ensure that energy problems did not hinder the country’s economic growth.

According to the World Bank, “at a time when the Ghanaian economy is achieving sustained growth in excess of six per cent annually, with ambitions to raise this further, there is a risk that misguided and inappropriate policies would lead to the power sector becoming a drain on the economy.”

Government itself is highly sensitive to these challenges and has incorporated the energy concern as a key focus in its policy development. The 2010 National Energy Policy by the Energy Ministry was directed towards curbing the challenges facing the energy sector. Its ultimate goal was to quickly increase installed power generation capacity, from about 2,000 to 5,000 megawatts (MW) by 2015, and increase electricity access from the current level of 66% to universal access by 2020.

One of the ways proposed for the achievement of the set target was for Ghana to move away from the traditional hydro generation of power into renewable energy. This would not only provide respite to the current strain on the nation’s power grid, but would also pivot the country in the direction of international trends towards eco-friendly power generation.

Ghana is well endowed with renewable energy resources, particularly solar and biomass energy resources. According to the state policy document, the government’s current challenge is attracting the investment to build the necessary infrastructure for supplementary power generation, transmission and distribution throughout the country. This is precisely the challenge which UK-based renewable energy firm, Blue Energy, is seeking to alleviate.

Blue Energy has unveiled plans to build a 155 MW solar power plant in Ghana, a project which analysts had said will be the largest of its kind on the continent. The company is set to finance, build, own and operate the power project near the villages of Awiaso and Akpandue, in the Ellembelle District of the Western Region of Ghana.

The $400 million project to be built under Blue Energy’s local subsidiary, Mere Power Nzema Ltd (MPNL), would produce 155 megawatts of electricity and increase the mix for renewable energy from 1% to 6%.

It is heartwarming to note that Captain Paul Fordjoe, the Director of NPNL had told the media that though the “NPNL is an independent power producer it had reached an agreement with the Electricity Company of Ghana (ECG) to purchase the power to be generated for distribution to consumers.

This therefore means that apart from delivering on the government’s renewable energy policy and agenda, the MPNL project would also become a source of employment for Ghanaians. The construction of the plant itself will provide an avenue for employment. Thereafter, a further team will be hired to oversee maintenance and operations, providing a steady stream of employment for years to come.

Dr Douglas Coleman, who is the MPNL Project Director, said initially the project would offer 200 job opportunities to people, of which 23 would be expatriates and that the numbers would grow as the work progressed.

The pioneering project is backed by members of the Stadium Group, a large European private asset and development company, eligible for feed-in tariffs. Industry analyst Ash Sharma at IMS Research indicated that the 155 megawatt plant will increase Ghana’s generating capacity by 6% envisaged it to be the biggest project in Africa.

Unlike many other solar projects on the continent that use concentrated solar power, the MPNL project will use photovoltaic (PV) technology. Concentrated solar systems focus a large area of solar thermal energy onto a small area, converting the concentrated light into heat in order to drive a turbine. The process requires a large amount of sunlight to generate power. In contrast, the photovoltaic solar method converts sunlight directly into electricity allowing a PV plant to generate more electricity using the same amount of sunlight, and bodes extremely well for the MPNL power plant.

In the past, the demand for renewable power in emerging economies like Ghana had been low due to high associated cost. Costs of solar had decreased dramatically in the last two years, falling by over 40%, making the deployment of this technology in Ghana a cost effective solution. The MPNL plant will also serve as a concrete demonstration of government’s commitment to global carbon reduction, leading the way in embracing sustainable technology and promoting eco-friendly development initiatives.

Given the precarious power situation which the country currently faced, it is clear that forward-thinking solutions which keep in step with international standards must be introduced if Ghana is to address the needs of its increasingly urban citizenry and its growing industrial sector.

Power supply cannot continue to outstrip demand, particularly as the nation charts a path towards middle-income status.

Against this backdrop, a solution which is both environmentally sound and promises to supplement the country’s current power generation to the tune of 155MW deserves the nation’s full support. Indeed, in light of Ghana’s current power crisis, the Mere Power plant may be the answer which the country needs.

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