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Business News Fri, 28 Oct 2005

$10 bn needed to finance West Africa Power Pool

Accra, Oct 28, GNA - About 10 billion dollars would be required in the short to medium term to meet the investment requirements for power generation and transmission infrastructure under the West Africa Power Pool Project (WAPP), Energy Minister Mike Oquaye announced on Friday.

The amount would be used to rehabilitate and construct new generation plants and to upgrade and build new transmission lines over the next 10 years, including the establishment of interconnection infrastructure and development of hydropower plants such as Keleta in Guinea and Felou in Mali.

The World Bank has already committed a 350-million dollar line of credit for the development of the WAPP out of which the Ghana Government and the Volta River Authority had secured 40 million dollars to implement the 330KV Aboadze-Volta Transmission Line.

Speaking at a meeting of Economic Community of West African States (ECOWAS) Energy Ministers on the WAPP project, Professor Oquaye said the Sub-Region must brace up itself to attract both multilateral and external private financing to meet the implementation requirements. He said with current changes in the lending policies of development partners it was essential the Sub-Region began to look for money outside its traditional sources such as the World Bank, African Development Bank to finance the investment requirements.

"On the other hand, our governments alone cannot bear the costs of these investments, hence the need to attract both multilateral and external private sources," the Minister stressed.

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The WAPP project envisaged the pooling of power systems of the countries in the Sub-Region to provide reserve support, increase economic efficiency of power generation, improve system reliability and make electricity price more affordable within the Sub-Region. The Ministers are in Accra to review the status of the ratification of the ECOWAS Energy Protocol and consider and adopt the Articles of Agreement of WAPP, which seeks to institute a management structure for WAPP.

Prof Oquaye called on the Ministers to hasten efforts at building the interconnection infrastructure to facilitate the pooling of power resources.

He said the benefits of the power pool would be fully realized when rural and peri-urban areas were able to benefit from modern energy services.

"Rural electrification in our Sub-Region should be approached as a multi-sectoral programme to achieve the overall objective of the WAPP. The Minister also called on member countries to accelerate the reform of the power sector and stressed the need for the harmonization of the regulatory environments in their respective countries.

He emphasized the need for clear and transparent pricing arrangements for cross-border trade to facilitate electricity exchange and trade. Prof Oquaye appealed to his colleague Energy Ministers in the Sub-Region to bring their influence to bear on the ratification of the ECOWAS Energy Protocol by the relevant authorities in their countries. This, he said, was important to move the agenda of the implementation of the West Africa Power Pool Project, which aimed to harness the combined electricity transmission capacity of the various countries to improve power generation and supply.

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So far Ghana and three other countries: Guinea, Nigeria and Gambia have ratified the Protocol.

Mr Daouda Toure, UNDP Resident Representative in Ghana, said although external partners support was important it was not enough to guarantee sustainable results without the sense of ownership and responsibility of the Sub-Region.

He said without increasing access to modern energy services, the poor would continue to be locked-in the poverty trap, and many developing countries would simply not be able to achieve the Millennium Development Goals.

The representatives of the various donor partners at the meeting pledged their continuous financial and logistic support for the project.

Source: GNA