The Electricity Company of Ghana’s (ECG) outstanding indebtedness to the Bui Power Authority (BPA) ballooned to US$614, 373,274.36 at the end of December 2022.
The debt is adversely affecting the smooth operations of the power generation company.
BPA operates the 404 mega hydropower Dam on the Bui River, the 50-Megawatts Peak Solar Power Plant and the Tsatsadu Mini hydro power plant in the Hohoe Municipality in the Volta Region.
The huge indebtedness was captured in the Auditor General’s report for 2022.
At the Public Accounts Committee sitting on Tuesday, the Chairman of the PAC, Dr James Klutse Avadzi advised the Management of Bui Power Authority to quickly recover the amount from ECG.
“The indebtedness will not go out completely at any point in time…it will continue because every day there is production, sale and repayment by the buyer, so what is more important is the rate at which the debt is being recovered,” he stressed.
According to the report, ECG owed the Authority $386 million as of the end of December 31, 2019, which increased to $614, 373,274.36 by the end of 2022.
The Chief Executive Officer (CEO) of BPA, Kofi Dzamesi explained that the Authority was not gaining any receivables from ECG despite doing its best to generate more power for the country.
He added that last year, BPA generated more power than any year in the history of the Authority since it was commissioned.
“We generated about 1,540 gigawatts and our profit margin for last year should be hitting around $70 million, yet we are not getting anything,” he lamented.
The PAC Chairman equally urged the Ministry of Finance to take more steps to ensure that all government agencies settled the debts they owed one another.
“They should ensure that at least, they settle some of the debt ECG owes other agencies like Bui and VRA because they buy the power from these two sources,” he said.
Dr Avedzi also urged agencies in the energy sector as well as other government agencies to refrain from charging their fees in foreign currencies, particularly, the United States dollars.
“Our currency is Ghana Cedi. ECG will sell the power and collect cedis and they will now go chasing to buy dollars to pay,” he said.
The Minister for Energy, Dr Matthew Opoku Prempeh, also recommended that steps should be taken to ensure ECG was financially viable as it continued to deal with Independent Power Producers (IPPs).
Source: https://energynewsafrica.com