Report wants ECG expansion works halted; rural electrification to be hard hit

The Electricity Company of Ghana has been asked to suspend all its expansion works.

This is one of the key recommendations contained in a report of feasibility studies on government’s decision to involve private partnership in the company’s operations.

The report intercepted by Joy News indicates that private sector participation is one of the conditions set for the disbursement of a 500 million dollar investment from the Millennium Challenge Corporation (MCC).

But two workers unions say the suspension of the expansion works will lead to the collapse of the rural electrification project, Joy News Kwetey Nartey reports.

The power distribution feasibility studies were carried out by the International Finance Corporation of the World Bank at the request of the government and Millennium Challenge Corporation five months ago.

The five-page report on the study stated that the government will have to adopt its recommendations as part of plans to introduce the private sector participation of ECG.

The MCC wants Ghana to focus on efficiency and cut down on waste.

“Efficiency is at odds with government focus on investment in growth by extension. While improvement in access is an important social goal, the single minded pursuit of expansion needs to be curbed to allow ECG management to focus on improving efficiency”.

The report cautioned that the power distributor’s deficit will worsen if the current emphasis on investment for expansion continues.

However, the Public Utility Workers Union and Public Services Workers Union have kicked against the privatization of the ECG.

In a document sighted by Joy News, the groups say that the private sector participation could spell doom for rural electrification because the MCC does not consider it profitable.

According to them, there are plans to privatise the Accra and Tema regions of the ECG. They insist that the power distributor’s problem is not its ability to attract funding but failure of government to pay its bills revealing that government’s indebtedness to the ECG stands at 1.2 billion cedis.

The firm position of the union groups is that if the challenge of power supply is not first addressed, the much touted privatization will only bring about increased tariffs and accumulation of profits of the private sector.