The Deputy Executive Director of the African Centre for Energy Policy (ACEP) is urging the incoming Energy Minister to renegotiate the Ameri and Karpower deals to ensure value for money.
Ben Boakye believes the erstwhile National Democratic Congress did not do enough due diligence in conducting a value for money audit in transacting those two energy deals.
Speaking to Joy News shortly after the announcement of Boakye Agyarko as the Energy Minister designate, Mr Ben Boakye said the new minister must, as a matter of urgency, look into those deals.
The Ameri plant which is expected to provide some 250 megawatts of power was procured at a total cost of $510 million. After the agreement had been sealed, AMERI went and outsourced the project to METKA, a Greek company, for a reported fee of $350 million.
ACEP believes the plant could have been procured at a much lower cost if the former government had gone directly instead of using a third party.
The energy think tank believes the Karpower deal is even worse. Karpower is also expected to provide 225MW at a cost of US$118.4 million.
However the total payment in 5 years for the plant amounts to US$592 million. KARPOWER is a 10-year deal so year 6-10 will have an additional fix cost of $495.8million, according to ACEP.
Ben Boakye said these deals have all together made power delivery expensive in Ghana which is not in the interest of the country.
“If power is expensive industry will not grow,” he said.
Ben Boakye believes the incoming minister has enough appreciation of the issues and the capacity to deliver.
As an investment banker, he would want Boakye Agyarko to restructure the suffocating debts owed by VRA, ECG.
“He must bring experience to bear, restructure the debts and bring sunshine to the energy levies being collected,” Ben Boakye stated.
He said he does not expect the incoming minister to have knowledge about everything, adding, he can seek technical advice on the issues he does not understand.