Ghanaian Times: Govt, IPPs must dialogue over $1billion debt

For some time now, the Independent Power Producers (IPPs) have been threatening to withdraw their services to back their demands for the payment of monies owed them by the government.

The Chamber of Independent Power Producers, Distributors and Bulk Consumers (CIPDIB-Ghana) that represents the IPPs on Thursday implored the government to pay 80 percent of the $1billion owed them or they would withdraw their services.

But the Ministry of Energy, in response, was quoted as saying that the government was on course with the settlement of the $1billion debt owed the IPPs and so did not expect them to withdraw their services soon.

According to the Head of Communications at the Ministry, Nana Oppong Damoah, the government had scheduled payment arrangements with the IPPs, which were being honoured to the satisfaction of the IPPs.

In an interview with the Ghanaian Times on Monday, which has been published elsewhere in this paper, he said the government was, therefore, surprised at a notice from the CIPDIB–Ghana that its members would withdraw their services over the debt.

“In fact, even today, some of them will receive payments as per the arrangement that is already in place. We are, therefore, surprised by this letter of notification to withdraw their service,” he said.

The Ghanaian Times does not intend to doubt the efforts the government is making to settle the debt owed the IPPs but we are worried about the threat being issued by the CIPDIB–Ghana because of the dire consequence, if they carry it out.

We all know the critical role the IPPs play in the generation and sale of electric power to the government and end-users.

Ghana has a vibrant power generation terrain with players from both the public and private sectors.

Since the reforms in the power sector in the 1980’s and the gradual removal of barriers and a level playing field created for the participation of independent power producers in an area which hitherto had only public sector participants, the country has benefitted immensely from their services.

Today, there are 12 IPPs such as Sunon Asogli Power, Cen Power Generation, Karpowership, CENIT Energy, AKSA Energy, BXC, Meienergy, Trojan Power, Early Power, Amandi Energy, Enclave Power and B5 Plus.

They have a total installed capacity of 4,132MW consisting of hydro 38%, thermal 61% and solar about 1%.

It is worthy to note that the role being played by these independent power producers (IPPs) in Ghana has continued to grow since the Takoradi thermal power station was first built in Aboadze in 2004.

Their contribution to the energy generation efforts cannot be overlooked because they are playing a very vital role in national development.

We, therefore, appeal to the government and the IPPs to continue to dialogue and to follow the payment plan agreed to by the two parties in order to avert any disruption of services provided by the IPPs.