Business News of Thursday, 26 January 2017
Energy Minister-designate, Boakye Agyarko, says Ghana’s energy sector is seriously cash-strapped to the extent that we now live in a debt merry-go-round.
The situation, which has arisen from poor financial management vis-à-vis inadequate fuel to power the country’s existing plants has resulted in incessant power cuts, popularly known as ‘dumsor, he said.
However, Energy Minister-designate gave the assurance that government would move the country from the current state of erratic power supply to an “ideal state of uninterrupted power delivery.”
He made this known when he appeared before Parliament’s Appointments Committee on Monday.
“The energy sector we find now is seriously cash-strapped to the extent that we now live in a debt merry go round. In trying to end dumsor, we have to improve the financial management and structuring within the energy sector and that is what I commit to do,” he said.
Mr. Agyarko added that the energy sector lacks the resources to ensure regular maintenance that would enhance power supply.
“Dumsor is not a function of installed capacity. Dumsor is a function of your ability to procure sufficient feed or crude, or gas to power the plants.
“Dumsor can also be a situation where power plants, particularly, thermal plants because of money are not undergoing their regular cycle of maintenance so they go past their firing hours, it reduces efficiency and hence they start having problems. The power plants at Aboadze are having that kind of problems,” he said.
He continued that “as it stands now, roughly forty, forty five percent of installed capacity is idle. It is idle because we cannot get the gas, the LCO or the HFO to power these plants. In certain circumstances, we do not have the money to do scheduled and regular maintenance, therefore threatening the plant in terms of warranty and insurance, so the problem has largely been one of how the money has been managed in the energy sector.”
Mr Agyarko stressed that the country had the human resources with technical ideas to address the power situation, but had failed to properly manage its finances in the sector.
He said under his leadership, the Energy Ministry will improve the financial management and structure of the energy sector to end the country’s energy woes.
The country has been experiencing incessant power crisis since May 2012 with failed promises from the authorities under the immediate past NDC-government led by John Dramani Mahama to fix it.
As at August last year, the former NDC administration had piled debts amounting to approximately GH¢4.4 billion cedis owed some 12 banks.
An initial payment of GH¢250 million was made to them.