Government on top of energy crisis - Adda

Accra, June 7, GNA - Ghana's energy sector is driven by a policy that is rooted in the overall development agenda of reducing poverty and becoming a middle income nation by 2015, Mr Joseph K.S. Adda, Minister of Energy has said.

Addressing Parliament on the current energy crisis, the Energy Minister said the problem has deep-seated implications for the national economy and since "we have gone through energy crisis before, it is imperative that we put things into perspective so that we can better appreciate the nature and scope of the problem and how government is solving it."


Minority members of the House initially objected to the making of the statement arguing that they had a motion with the same subject and due to the closeness of the issues; they would wish it to continue on Friday.


The Speaker however, objected to their plea and asked the Energy Minister to continue with the statement.


Continuing, Mr Adda in his 21-page document said the President has set in motion a process that would speed the addition of at least 1,000 megawatts of power within 18 to 24 months.


"It was this move which the Ministry had set itself to that we ere saddled with the Akosombo reservoir crisis and the need for a load shedding programme to conserve water and protect the turbines. "From then on, the general efforts of the power sub-sector have been dedicated to managing the situation as well as working to bring the load shedding to an end."

Mr Adda said a lot has been done resulting in the acquisition, installation and operationalization of the relatively smaller emergency plants while lining up much bigger plants for the medium to long term.


"The details of this would be stated in due course," Mr Adda said. He said energy crisis was a global problem with countries such as South Africa, Uganda, Kenya, Tanzania and Zimbabwe facing similar problems with power generation capacity, and some shedding power 36 hours continuously before power comes on for only 12 hours. He said, "With this information, the point is clearly made that the Ghanaian situation is not unique."


He said various levels of commitment have been entered into between relevant agencies and private entities ranging from MOU's to power purchase agreements to tap into these natural endowments that God has bequeathed to us.


Mr Adda noted that government was pursuing a generation mix that fully exploits all the nation's potentials to ensure energy self-sufficiency and also to become a net-exporter of power. The strategic plan that has been designed is to pursue this objective with short term, medium term and long term perspectives. He gave a historical overview of the load shedding exercise in Ghana calling it an "unpleasant situation."


Mr Adda said an attempt was made in 1998 to bring in thermal generation through a rental system which only brought in two of the suppliers; Aggreko and Cummins.

Cummins was not fully operational before the crisis was over. But having signed a take-or pay power purchase agreement, the government then was called to pay.


"Meanwhile," he explained," Global Aero Design Company, Faroe Atlantic Company and Stone and Webster, did not generate any power, but went ahead to sue government for damages, . for which government is battling to settle a 20 million dollar debt in London to Cummins.


"This experience is a good lesson for us to tread cautiously so as not to throw away badly needed funds on faulty contracts hastily put together that might not solve our problems."


Mr Adda noted that government has moved on significantly since then and has lined up additional generating capacity to bring the situation back to normal, filling up a total of 342 megawatt by September. "Government has put in place emergency plants that would generate 126 megawatts while the Armed Forces Support unit is providing 10 megawatts by June ending.


"The mining consortium is also providing 80 megawatt by July and the VRA and government collaboration would bring in another 126 megawatt by September."

The Wood Group, a private sector initiative from the UK is also providing 50 megawatt in July, 2007 while energy efficiency dividends from the introduction of 6 million pieces of fluorescent bulbs would result in the saving of 200 megawatts.


He said a significant number of bulbs have arrived and are currently being installed in public buildings, after which they would be offered to the public for sale.


On the medium and long term projects on solving energy problems, the Ministry is in the process of procuring additional power plants to be installed in the next 12 to 18 months.


"This forms part of the plan to have an installed capacity of over 3,000 megawatt by 2010. This would result in a substantial increase from the current installed capacity of 1,730 megawatts."


Mr Adda told the House that the objective of the medium term programme was to develop sufficient generation reserves to ensure that the country does not go through this experience again in the future. The projects are a 220 megawatt power plant procured from ALSTOM of Switzerland, which will be operational by September. This would be converted into a 330 megawatt combined cycle plant in the future and an 84 megawatt power plant from Ranhill of Malaysia that would be operational in July 2008.

The Osagyefo barge would be operationalised with a 125 megawatt power in 2008-2009.


He said Bui hydro electric power plant is to commence in the third quarter of this year and completed in 2011 or 2012 providing 400 megawatts of power.


A total of 110 megawatts is to be added to the Takoradi International Company converting it to a combine cycle plant in 2009. Contributing to the statement, Mr Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning called for urgent and serious attention to the situation.


"We must all give the crisis an urgent attention and ensure that we come out of it as soon as possible."


He gave the assurance that the 300 megawatt shortfall must be addressed as soon as possible and, "government would find money either from the consolidated fund or from grants, loans or wherever to see the situation through."