MoUs on MCC compact signed: $500 million for power

The United States government is preparing a $500 million grant to support Ghana’s power sector through the second Millennium Challenge Corporation (MCC) compact.

When finalised, this compact will directly strengthen the power sector by improving reliability and service delivery, as well as help ensure continued and cost-effective power supply.

The US Ambassador to Ghana, Mr Gene A. Cretz, who announced this in Accra yesterday, said the second compact could be finalised by August this year if the momentum on the reform agenda was sustained.

Mr Cretz, who was speaking after the signing ceremony of two memoranda of understanding (MoUs) to strengthen Ghana’s energy sector, described the first compact as very successful.

 The MoUs are to increase the scale of quality of energy supply, improve operational efficiencies of the utilities and increase access to electricity.

In addition, the MoUs highlight the tremendous efforts made by the government of Ghana and the US to ensure that the investment climate in Ghana is able to absorb the significant investment that is primed to enter the market. 

The signing ceremony was witnessed by the US Secretary of Commerce, Ms Penny Pritzker, who is heading a trade mission made up of 20 US companies in the energy sector to the country.

Mr Cretz was hopeful that the two countries would work hard in the coming months to finalise the deal to improve the energy sector.

He said Power Africa, an initiative of President Barrack Obama to support Africa’s enormous power potential through partnership, trade and investment, was part of the process.

He said President Obama recognised the critical role power played in moving Africa into the next stage of development.

“What we have to do with this is harness all the capabilities we have in our governments, agencies, as well as the private sector, to bring the transactions between the private sector and the government of Ghana to achieve all of these goals,” he said.

Mr Cretz said a number of companies were gaining serious momentum on some exciting projects in the power sector in Ghana and mentioned some of them as General Electric, Symbion, HPI and ECC.

He said all those companies were making progress, adding, “I hope that the Secretary and I will soon be announcing deals that come out of the relationships built during this trade mission.”

The Minister of Energy and Petroleum, Mr Emmanuel Armah-Kofi Buah, who signed on behalf of the government of Ghana, expressed the hope that the MoUs would boost the confidence of investors.

He said one of the challenges confronting the country was how to explore a cheaper source of power — gas — and was hopeful that with the coming of the second compact, the country would be able to build the required infrastructure that would guarantee long-term gas supply.

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