We can’t guarantee reliable power supply; we are on brink of walking away from PPA restructuring process – IPPs to government
The Chamber of Independent Power Generators Ghana (IPGGs) has expressed concern regarding the delays in obtaining governmental approvals for the PPA restructuring documents.
According to the Chamber, its members are on the brink of walking from the PPA restructuring process and reverting to its existing PPAs.
In a statement signed by the Chairman of the IPGGs, Togbe Afede XIV, to the Ministry of Finance received on August 16, 2024, the IPGs or IPPs said they respectfully demand as a matter of urgency an appointment with the Finance Minister, Dr. Mohammed Amin Adam, to discuss and resolve these critical issues.
“We respectfully, as a matter of urgency, demand an appointment to meet with you to discuss and resolve these critical issues. This meeting must occur at the earliest opportunity next week, as any further delay could be catastrophic for the nation’s power supply stability. We kindly request that you confirm your availability for this meeting at your soonest convenience.”
It continued “The current situation is extremely disappointing as the IPGs played a major role in working with the government to support its necessary restructuring of the country’s indebtedness in order to qualify for the IMF [International Monetary Fund] loans. Not only did many of the IPGs agree to a haircut on the arrears owed to them at the time; IPGs agreed to defer a significant portion of future payments to enable the government to recover under the IMF programme.”
“Despite the economic hardship this caused the IPGs, we agreed to this structure to ensure the IPGS would receive consistent payments to cover our operations and debt obligations. We are hardly a year removed from shaking hands with this new arrangement and ECG is already materially in default to the amount of $1.4 billion. As you can imagine, we feel highly betrayed by the situation we find ourselves in today”, it said.
It concluded “We are in a dire strait as the Government of Ghana and ECG have not fulfilled their end of the bargain. If the current situation continues, the IPGs will be left with no option but to exercise their rights under their respective contracts and to discontinue any unfulfilled negotiations. At this point, we cannot guarantee our cooperation moving forward, nor can we guarantee the continued reliable supply of electricity beyond August 30, 2024.