Government terminates 11 power purchase contracts at $400m

The Akufo-Addo government has terminated 11 power purchase agreements at a cost of $400 million to the state since assuming power, Energy Minister Boakye Agyarko has told Parliament.

Also, 7 other power contracts have been deferred following recommendations of the Philip Addison-led review committee set up by the government.

The minister, however, added that despite the cost implications of the termination of the power deals, the state will eventually make savings of some $7 billion.

“Pursuant to the review exercise, government will make significant savings from the deferred or terminated power purchase agreements. The estimated cost for termination is 439 million US dollars compared to the annual capacity cost of 586 million dollars each year or a cumulative of 7.6 billion US dollars from 2018 to 2030. Mr. Speaker this yields an estimated savings of 7.217 billion US dollars over a 13 year period.

Mr. Agyarko also noted that government has insured the FPSO Kwame Nkrumah against intermittent breakdowns and shutdowns for routine maintenance works. According to him, hitherto, only the jubilee partners enjoyed insurance for interruptions in production.