Ghana Signs First Take-And-Pay Power Purchase Agreement With Turkish Energy Firm

Ghana has signed the first take-and-pay power purchase agreement with Aksa Energy Company Ghana Limited, a Turkish power firm, for the construction of a 205MW capacity combined cycle gas turbine plant in Anwomaso in the Ashanti Region.

Previously, all power purchase agreements signed with independent power producers were take-or-pay.

The Akufo-Addo administration raised concerns about how the cost of electricity had become very expensive as a result of the ‘Take-or-Pay’ clauses in the PPAs signed during the previous regime.

To address the issue, the Energy and Finance Ministries came up with new criteria by ensuring that, going forward, all PPAs for new projects are signed under ‘Take-and-Pay’ clauses.

A take-or-pay contract clause obligates a buyer to pay for a contracted quantity of a commodity, regardless of whether the buyer takes the entire quantity agreed or not while take-and-pay is an agreement where the buyer’s obligation to pay is not unconditional, but is contingent on either upon the delivery of purchased goods or services or upon the buyer’s consent to take the delivery.

Last week, energynewsafrica.com, reported that ECG had signed a power purchase agreement with Aksa Energy.

Details of the agreement were scanty but in a post on ECG’s Facebook on Tuesday and sighted by energynewsafrica.com, ECG said the agreement with Aksa Energy was Take-and-Pay with a 40 per cent guaranteed dispatch.

According to ECG, there would be no buyer guarantee and no government guarantee.

The project is expected to reach commercial operations in the 4th quarter of 2024.

According to ECG, the project would enhance power generation capacity and voltage stability for customers in the middle belt of Ghana and the export market.

The responsibility for fuel supply would lie with Aksa.

Source: https://energynewsafrica.com