Executive Director for the Africa Centre for Energy Policy, Benjamin Boakye, says Ghana may never see any real development till the energy sector debt is fixed.
According to him, the ever rising energy sector debt continuously to cripple the national budget, leading to poor financing of government’s Ministries and other developmental projects.
He attributed the ever rising energy sector debt to the inefficiencies of the Electricity Company of Ghana to fully recover the operation cost as well as the cost of purchasing the power from the generators, thus inadvertently adversely affecting the energy value chain.
Speaking at the Energy Dialogue held at the Labadi Beach Hotel, Accra, he said: “Across the value chain, every agency- from generation, transmission to distribution- is making a net loss year on year. ECG alone in 2018 (Ministry of Finance data) made a loss of about 3 billion Ghana cedis.
“So what that means is that if ECG buys power and sells the power, they are not able to recover the operation cost and also the cost of purchasing the power from the generators and that affects everybody in the value chain.”
He stated that political parties only promise to pay the energy sector debt without outlining a plan to effectively deal with the problem and paint a clear picture of how urgent the matter is to the development of the country.
“So it’s a very scary situation that we have to have a fair conversation and look beyond the faces and say let’s deal with this problem and address the fundamentals of this problem,” he said.
He stated that even though there had been moves to fix ECG, it had failed due to losses the ECG had incurred from theft.
However, he said even though these issues of theft could be checked, the lackadaisical attitude of those at the distribution centres have contributed to the proliferation of energy theft in the country.
“What that also means is that those losses that are as a result of theft most of whom are foreigners – Chinese companies, other foreign companies tapping electricity and not paying; the debt sits on government books. You and I, who may be genuine to pay your bill are called upon to pay more because people are stealing. Nobody cares because it doesn’t come directly from their pocket,” he bemoaned.
“So it is a tough conversation we need to have to fix that, to ensure that we can relieve the budget of Ghana from this unwarranted payments because the energy sector is so sick and we don’t confront it the way we really have to do,” he added.
He stated that till the energy sector debt is fixed, Ghana will continue to suffer a stunted development.
“If you look at the energy sector debt and the financial loss it can adequately cater for ten ministries and their budgets. The Ministry of Gender, do you know their budget? 4million Ghana cedis and this is an hourly loss in the energy sector. So it’s a very scary situation.
“That is the conversation the media should be having on the radio every morning. Because the road is not going to be fixed if this kind of loss is being created and generated in the energy sector; nothing is going to get done.”