General News of Tuesday, 19 September 2017
The controversial AMERI Power deal is costing the country a whopping $11.5 million a month, workers of the Volta River Authority (VRA) have said.
As a result, the Authority has incurred a debt of $218 million for the past 18 months the John Mahama administration signed the deal in January in 2016.
And with the deal said to be in force for the next five years, workers at VRA say the future of the Authority is bleak and are calling for urgent revolutionary measures by government to keep the Authority afloat.
Explaining how the country incurred the losses, Chairman of the VRA senior staff association Cephas Ducer, said per the off-taker agreement signed in the AMERI deal, Ghana Gas would have to supply gas to AMERI at a cost and after the power is produced there is a capacity charge and variable cost.
“The total cost of AMERI power is the cost of the gas plus the capacity charge,” he said, adding, they have a tariff of 15 cent per kilowatt hour but the same power is sold to ECG at a cost of 5 cents per kilowatts hour.
“For every power we pick from AMERI and sell to ECG we have a deficit of 10 cents per kilowatts we have to deal with. We have done the analysis and on the average we incur a loss of 11.5 million every month.
“That is how bad the agreement is and someone must pay for it,” Cephas Ducer told Joy News’ Evans Mensah.
His revelation comes at a time government is considering renegotiating the controversial AMERI deal.
In 2015, the John Mahama administration signed a $510 million Build, Own, Operate and Transfer (BOOT) Agreement with AMERI Energy to help solve power crisis the country was enduring at the time.
The deal was criticized heavily by the then opposition, as well as civil society groups including ACEP and IMANI.
There were claims the deal had been inflated by about $150 million, an allegation officials of the former administration have rejected.
Several months after operation, VRA says the deal is unsustainable.
Cephas Ducer does not understand how government will sign an agreement with private power producers who will be depending on government for gas to run their facilities.
He would rather these power producers purchase their own gas supplies.
“Until recently, about 70-80 per cent of the gas VRA procured from Nigeria was given to Sunni Asogli for their thermal power generation.
“The Authority has done this for the past ten years. As at now Asogli owes VRA over $203million for gas supplies,” he said, adding the delayed payment led to suspension of gas supply to Ghana in July 2016.
Hands off Assets
While demanding a better deal in the AMERI arrangement, the workers have also issued a strong warning to government to keep its hands off the Authority’s thermal assets.
“…If the Energy and Finance Ministries, for that matter the government, truly believes in making government efficient, profitable and help it compete favorably in the energy market, they should as a first step of restructuring VRA ensure that VRA’s thermal and non-power generating assets are not sold out.”
The warning comes after government placed an advert in the dailies seeking private buyers for the VRA thermal assets.
Ducer insists that policy will have dire consequences for the energy sector.
He also warned the two ministries from micro-managing the VRA.