Ofori-Atta unveils a committee to review take or pay agreements, etc.

The Minister for Finance announced a committee to take over the consultation process with independent power producers and gas suppliers as part of efforts to reduce the burden imposed on the state by a number of’ take or pay’ power purchase contracts, among other issues in the energy sector.

Ken Ofori-Atta, inaugurating the Government-led Energy Sector Recovery Program Steering Committee, made up of representatives across industries and ministries, said the move was part of efforts to tackle energy issues in a way that is sustainable for both Ghana and its partners.

Mr. Ofori-Atta, delivering the mid-year budget review to Parliament in July of this year, announced the government’s intention to renegotiate multiple agreements in Ghana’s energy sector, including all acquisition and pay power purchase agreements; to place a moratorium on the signing of new power purchase agreements in the energy sector.

“The Steering Committee is of key importance for the future of Ghana’s energy sector and Ghana’s long-term sustainable development government has been working hard to establish a long-term sustainable strategy for a competitive and dynamic energy sector where private investments can thrive, and the interests of the Ghanaian people and businesses continue to flourish,” the Finance Minister said.

The inauguration is part of a decision taken by the Task Force on Energy Sector Recovery, as mandated by Cabinet to ensure and oversee the implementation of the Energy Sector Recovery Program (ESRP).

The Ministry of Finance and the Ministry of Energy have been collaborating with IPP and GS representatives since August 2019 to find solutions that contribute to a decent outcome for all stakeholders – both the citizens of Ghanaian and investors.

Currently, Ghana has an installed power generation capacity of 5,083 MW, a dependable capacity of 4,593 MW and a peak demand of around 2,700 MW.