Failure to buy fuel caused ‘dumsor’ under NDC – Government

General News of Friday, 9 November 2018

Source: thefinderonline.com

2018-11-09

Energy Minister, John Peter Amewu

Government has hit back at former President John Dramani Mahama for claiming the National Democratic Congress (NDC) fixed the country’s power crisis before handing over power to the President Nana Akufo-Addo in January 2017.

In a statement issued by the Communications and Public Affairs Unit of the Ministry of Energy, dated November 6, 2018, government said at the time President Mahama left office, the only intervention he made towards addressing ‘dumsor’ was the expensive emergency power plants he brought in which have led to unwanted excess capacity and heavy financial burden to the state.

According to the statement, contrary to Mr Mahama’s claim, the deployment of emergency power did not provide the solutions the country needed at that time.

“We have always known that the problem of ‘dumsor’ was financial and not shortage of generation capacity. At the time ‘dumsor’ reached its peak, Ghana’s installed generation capacity was 3,600 MW against peak demand of 2087 MW,” the statement indicated.

It added that: “The rapid rise of demand for power from 2087 MW in November 2016 to the current level of over 2,400 MW shows that ‘dumsor’ could not have ended in 2016 but that there was a substantial residual power demand that is now being met with regular electricity supply.”

Mr Mahama, while on his five-day campaign tour of the Greater Accra Region last week, was reported to have said the NPP has been deceiving Ghanaians that their government ended the country’s power crisis.

He claimed the Nana Addo government has not added a single generation capacity of electricity to Ghana’s power generation and therefore cannot claim to have fixed the energy crisis.

But the Ministry of Energy statement that sought to clarify the assertions made by the former president explained that the then NDC government had no ideas about how to finance procurement of fuel by Volta River Authority (VRA) to run the existing plants owned by the Ghana.

“They instead piled up debts for the energy sector which stood at $2.4 billion at the time the NDC left office in 2016. They also failed to regularly maintain the existing plants and worse of all, they over-drafted the Akosombo Hydro dam and grossly depleted its capacity to generate power,” the statement noted.

It indicated that the current use of the emergency power plants to generate power at the moment is not due to the non-availability of alternative generation plants but due to the take-or-pay obligations the Mahama-government committed the nation to.

This, the statement explained, resulted in the decision by the present government to leave Ghana’s own plants idle to generate power from the emergency plants because the nation still have to pay for the capacity whether they generate power or not.

“In spite of high levels of water in the Akosombo Dam, we are still operating three turbines to avoid liabilities of the emergency plants President Mahama brought in. In fact, our thermal plants at Tema and Aboadze run less than 50 per cent of the time because of the same take or pay arrangements,” the statement grieved.

It also raised concerns about the signing of more than 30 Power Purchasing Agreements (PPAs) by the Mahama-government “under the pretence of solving ‘dumsor’.

“The reality is that the power deals were avenues for rent seeking and corruption; it made no sense for the Mahama-government to sign a cumulative 11,000 MW of generation capacity when Ghana’s peak demand is just about 2,400 MW,” the statement said.

“These Agreements will also put on the state a huge cost of $7 billion in capacity charges from 2018 to 2030 although most of the plants will not be utilised. The Government of President Nana Akufo-Addo has however taken the painful decision of terminating 11 of the PPAs at a cost of $402.39 million, whilst others have been deferred, to save the country an annual cost of $586 million.”

The statement noted that the current improvement in the supply of electricity is also due to the NPP government’s successful arrangement with fuel suppliers for uninterrupted supply of Heavy Fuel Oil (HFO), and the dedicated stock of light crude oil kept by VRA against unexpected shortage of natural gas.

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