The Electricity Company of Ghana (ECG) is facing significant challenges in paying its debts to the nine Independent Power Producers (IPPs) that support the country’s energy sector. One of the IPPs, Sunon Asogli, halted operations in October due to a staggering $259 million debt. The other eight IPPs have also expressed concerns about the government’s failure to pay for the electricity they generate and distribute.
In an interview on Joy News’ Newsfile on November 23, 2024, Ing. Asamoah David, ECG’s acting Managing Director, attributed the worsening situation to fluctuations in the foreign exchange market. “The truth is that the majority of these debts are a result of a forex shortfall,” he explained. The ECG incurs a monthly loss of approximately 37 million cedis due to forex issues, making it difficult to pay the IPPs on time.
Ing. Asamoah emphasized that paying in cedis would improve the situation, but the current arrangement requires payments in dollars, leading to shortfalls due to exchange rate fluctuations. Despite these challenges, the ECG is working to manage the payments, and a new agreement has been made with the IPPs. The Ministry will also contribute to the payments, and the IPPs have agreed to continue their operations.
Sunon Asogli is expected to resume operations in the coming weeks, and other IPPs that had reduced their power supply will also increase their output. The IPPs play a vital role in supporting the country’s electricity grid, and resolving these financial and forex issues is crucial for the sector’s stability.
Ruth Abla ADJORLOLO
