Dr. Mahamudu Bawumia, running mate to the opposition New Patriotic Party’s 2016 Presidential Candidate, Nana Addo Dankwa Akufo-Addo, says it “makes no sense” for government to secure a power barge as an emergency solution to the power crisis, explaining that the deal does not give the country value for money.
The 225 megawatts power barge docked at the Tema Port over the weekend, and is expected to augment the shortfall in power supply.
Addressing journalists on the government’s 2016 budget and its record in the last seven years as against the NPP administration’s record, Dr. Bawumia mocked the Mahama administration for repeatedly making promises to fix the power crisis [dumsor] yet has not been able to fulfill them.
[contextly_sidebar id=”3qEt3eiHrupg5iRdVE3MrT1640xZ7ZZE”]Chronicling the number of promises that have been made by the President and his appointees on fixing the power crisis since 2012, Dr. Bawumia concluded that the government is not committed enough to address the power crisis.
“After promising to resign if dumsor is not over by the end of the year, the Minister of Power is now saying that he was talking about load shedding and not dumsor. We are still trying to understand what he means. The fact remains that, four years down the road, dumsor is still present and the government has just announced the arrival of an emergency solution by contracting a power barge for ten years with a reported 100 million dollar guarantee for fuel. At the same time, VRA has shut down its plants because it cannot produce.”
“It makes no sense”
Per Dr. Bawumia’s analysis, “A 225 megawatts plant like the Karpower Plant that we are renting, will cost some 225 million dollars if we wanted to purchase it; and we will own it. Under the Karpower deal, we will pay for the power from the barge for the next ten years whether we use it or not. The African Center for Energy Policy (ACEP) estimates that based on the capacity charge alone which is 5.6 cent per kilowatt hour, it will cost Ghana close to one billion dollars over the next ten years for the energy from the barge; this however excludes the cost of fuel which will require about 35,000 tones every month. After ten years, the barge will sail away and with this one billion dollar, we could have built a 1,000 megawatt plant for ourselves. Power from the barge will also cost at least twice what it cost to sup-ply power from Takoradi. This really does not make sense.” he concluded.
Dumsor is a financial problem
According to Dr. Bawumia, the current energy crisis is largely due to a lack of financial resources despite the government’s claim the situation has nothing to do with money.
“After several denials by government, it should be clear to Ghanaians that crisis is not the result of inadequate installed capacity; but rather a lack of financial resources to utilize the installed capacity. Installed capacity currently stands at 2,923 megawatts with a peak demand of 2,200 megawatts leaving excess capacity of 723.5 megawatts. But government is highly indebted to VRA and ECG; government owes ECG some 700 million Ghana Cedis and owes some VRA one billion. VRA owes its creditors including N-Gas of Nigeria and the West African Gas Pipeline a total of 1.3 billion dollars; this has compromised its balance sheet and its ability to import crude oil for the generation of power. Currently, VRA has shut down a number of its plants because it is unable to purchase fuel to run them. Ghana also owes Nigeria some 970 million dollars for which the country is struggling to pay.”
He questioned “Why is it that after four years of trying, the government has still not found a solution to the problem? The simple answer is that, government has been in denial and has not prioritized this issue. The government has borrowed three million dollars from the issuing of Eurobonds alone; in total, government has borrowed in total the equivalent at the time of borrowing, 37 billion US dollars in the last seven years; how much of these borrowed funds have been used to address the dumsor problem? If this was a priority for government, the necessary allocation of resources would have been made to resolve it, the necessary allocation of resources would have been made to resolve it.
Dr. Bawumia says President Mahama’s latest comment in Tamale that dumsor will end before the 2016 elections and cannot be used for politics, shows that it [Dumsor] may only become a priority for government close to the elections in 2016.
By: Ebenezer Afanyi Dadzie/citifmonline.com/Ghana