No tariff increase as a result of ECG legacy debt – Energy Minister

Mr John Peter Amewu (left) addressing the participants

Mr John Peter Amewu (left) addressing the participants

There will be no tariff increase as a result of legacy debt incurred by government subsidy when the concessionaire take over the Electricity Company of Ghana, in the near future, the Ministry of Energy has assured Ghanaians.

This, the ministry said was because the contract agreement between the government and the concessionaire waived any debt liability when the company takes over ECG.

This was made known during the question time by the media when the Ministry of Energy took its turn at the Meet-the-Press series in Accra yesterday to shed light on some of its policies, programmes and projects within the ministry and its agencies and departments.

Giving answer to a question whether the take-over of ECG would lead to automatic tariff adjustment upwards as a result of the legacy debt, Owireku  Aidoo, a Deputy Minister for Energy, flanked by the ECG boss, Boakye Appiah, said the pricing of electricity tariffs was the prerogative of the Public Utility and Regulatory Commission(PURC).

Mr Aidoo said talks were currently ongoing between PURC and the concessionaire to determine the modalities for tariff adjustments to ensure appreciable recovery rate for the concessionaire’s operations when the company eventually takes over ECG.

He said that the process had also delayed in the concessionaire’s providing guarantor(s) as stipulated in the contract agreement which could ultimately affect next week’s handing over as earlier announced.

Touching on the viability of the Tema Oil Refinery (TOR), Isaac Osei, the Managing Director said the company was currently operating below its capacity with only 25,000 barrels of crude being refined per day from a maximum of 45,000 barrels per day adding that such a situation could not augur well for the company to remain solvent.

Mr Osei said in strategising to move TOR to break even and make the company more profitable the company was in talks with the ministry to consider a private sector participation in the industry through re-capitalisation.

Mohammed Amin Antah, a Deputy Minister of Energy in charge of Petroleum in an addendum said the government was also considering other options before settling on the private sector participation.

He said some of the options were either providing Ghana’s shares of its crude oil from the TEN field to TOR for refining, as a form of equity shares to help revitalise the company or in the absence of that approach, Nigeria or Equatorial Guinea to supply TOR with crude on concessionary basis.

Mr John Peter Amewu, Minister of Energy sought to allay the fears of Ghanaians when in response to aquestion on whether there was a boundary dispute between Ghana and Togo over prospecting of oil, said the issue had to do with the Keta Maritime boundary with Togo and had nothing to do with the Volta Basin which boundary was determineby the colonial administrators.

He said talks were currently on-going between Ghana and Togo to know the position of a pillar into sea which would determine to some extent the maritime boundary between the two countries.

Mr Amewu assured Ghanaians that the erratic power supply (dumsor) which nagged the previous government was technically over save for intermittent routine maintenance work and at times the late delivery of light crude to power the thermal plants.

He added that the power crisis was as a result of the management of the sector which the government had dealt with by putting measurable interventions in place.

He said plans were also far in advance to relocate the Karpower Plant to Takoradi  from Tema by July this year, to feed on the gas for generation of power instead of light crude it was using in its present location to generate its power.



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