The Africa Sustainable Energy Centre (ASEC) has expressed strong opposition to the proposed merger of the Volta River Authority (VRA) and Bui Power Authority (BPA), as well as the establishment of an independent Thermal Power Authority.
ASEC argues that the merger poses significant economic risks, including exposure to sharp electricity price hikes due to privatization, compromised ability to guarantee reliable energy supply, stifling of innovation and competition in the hydropower sector, amplification of drought and water management risks, delayed progress in the national renewable energy drive and erosion of financial stability and years of progress in the energy sector.
In a press release, ASEC argued that the merger would dismantle VRA’s carefully balanced energy portfolio, including solar, thermal, and hydropower, and could lead to Ghana’s energy security collapse.
The think tank also expressed concerns about the government’s plan to separate VRA’s thermal assets into an independent thermal power authority, which could lead to privatization and expose consumers to massive price hikes.
ASEC noted that VRA has a track record of profitability, making a merger unnecessary.
They also warned that privatization could lead to a catastrophe, citing examples from California and Brazil.
Additionally, ASEC rejected the proposal to merge the Northern Electricity Distribution Company (NEDCo) with the Electricity Company of Ghana (ECG), stating that it would divert attention from addressing core issues and make it difficult for the new distribution company to profit.
Instead, ASEC recommended privatizing part of ECG’s operations to address the current electricity sector challenges, promote fiscal discipline, and generate revenue.
The think tank called for transparency and consultation in the decision-making process, emphasizing the importance of preserving the independence of VRA and BPA to ensure continued progress in the energy sector.
ASEC believes that VRA must remain unified to ensure reliable and affordable electricity for all Ghanaians.