Ghana Now Paying Nearly All Monthly IPP Bills — Jinapor

The Minister for Energy and Green Transition, Dr John Abdulai Jinapor, says Ghana is now settling approximately 100 per cent of monthly invoices submitted by Independent Power Producers (IPPs), following reforms to improve revenue collection and payments across the energy sector.

According to the minister, the payment level represents a substantial improvement over previous years, when producers received between 40 and 42 per cent of their billed amounts. Those shortfalls contributed to mounting arrears and threats of electricity supply curtailment.

Dr Jinapor attributed the turnaround to stronger revenue mobilisation and changes to the Cash Waterfall Mechanism, which distributes funds among entities in the electricity supply chain. He said allocations declared under the mechanism had increased from GH¢6 billion to nearly GH¢15 billion.

The minister also reported that the government had cleared US$1.47 billion in legacy energy sector debts. This included outstanding gas payments to upstream partners ENI and Vitol, as well as restoring a depleted World Bank Partial Risk Guarantee.

Contract reviews formed another part of the reforms. The ministry worked with stakeholders, including the Africa Centre for Energy Policy, on renegotiations of operational IPP agreements that reportedly secured US$250 million in savings for the state.

A greater reliance on natural gas for power generation, replacing more expensive liquid fuels, also generated an additional US$500 million in savings, according to the minister.

Before the interventions, outstanding obligations across the power supply chain, largely associated with the Electricity Company of Ghana, had reached approximately GH¢80 billion.

The improved settlement of current invoices is intended to limit the accumulation of fresh arrears while authorities address the sector’s existing financial obligations.

Dr Jinapor said sustained progress would depend on better revenue collection by state-owned enterprises and electricity off-takers, alongside consistent payments to suppliers throughout the energy sector.

Omanghana is an online news portal that provides readers around the world with a greater focus on Ghana and other parts of Africa. Established in 2009, Omanghana regularly publishes articles related to News, Sports, and Entertainment.

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