President Mahama cautioned over ECG privatisation

Nana Akomea, the Deputy Chairman of the 2024 NPP presidential candidate Dr. Mahamudu Bawumia’s campaign team, has welcomed the decision to privatize the Electricity Company of Ghana (ECG).

The Minister-designate for Energy, John Jinapor, has emphasized the importance of significant private-sector partnerships with the ECG to improve the company’s efficiency and enhance electricity supply nationwide.

The government has warned of a looming power crisis, revealing an energy sector debt of over $2 billion, which paints a grim picture of the industry.

As part of efforts to address inefficiencies, President John Mahama stated, “If we don’t fix the Electricity Company of Ghana, we will continue to have a major problem with our whole power value chain. So, going ahead with privatizing the last point of electricity distribution and bringing in private-sector efficiency is something that we want to take up again.”

He assured stakeholders that decisions regarding ECG’s future would involve thorough consultations. “We want to speak with the World Bank to get the expertise to be able to do that,” he added.

Additionally, John Jinapor announced the government’s plan to establish a seven-member committee to explore privatization options for the Electricity Company of Ghana.

“We believe there should be private-sector participation,” Jinapor stated during his vetting before Parliament’s Appointment Committee.

The Energy Minister-designate also outlined a non-partisan approach to the process, emphasizing, “We will stay out of it as politicians and let them develop a framework in a transparent, open, and frank manner. Once we get the buy-in of Ghanaians, we can set standards using a Request for Proposal (RFP) or competitive tender process.”

Nana Akomea, reacting to this during a panel discussion on Peace FM’s “Kokrokoo” morning show, expressed optimism that this decision would help revamp the energy sector.

He highlighted debt as one of the key challenges crippling ECG, noting that the company incurs losses of about 40%.

Nana Akomea suggested that, as part of the privatization measures, Ghana’s currency dependency on the US dollar should be addressed.

“If the strength of the cedi matches the dollar, then ECG can improve. But if the cedi is not strong, the company will still encounter these challenges,” he said.

He also urged the government to reexamine the Power Distribution Services (PDS) arrangement to revitalize the energy sector.