The government must help to provide a bankable credit security
Stakeholders in the power sector have called on the government to put in place a workable plan that will give investors value for money and curtail the piling up of debt on the balance sheets of entities in the value chain.
According to them, the absence of a binding plan on the back of consistent power generation over time has led to a knee-jerk approach in handling problems of the sector.
Chief Executive Officer of energy advisory firm, Arthur Energy Advisors, Harriette Amissah-Arthur, said at a plenary session on energy at the 2017 Ghana Economic Forum in Accra that: “We must operate the power sector as a business backed by a plan which outlines the various opportunities and risks for investors if we want to deal with the debt overhang in the industry.
The energy sector is being treated as an island; but with power as the backbone of the economy, we need to run the industry along business principles.”
She added: “We are competing for investors who will be looking out for project feasibility before they inject capital and we, therefore, have to package the sector with a plan.”
Other discussants supported Harriette’s position, saying a workable plan will ensure prudent management of the sector to cushion the bottom-line of industry players and to make the sector more productive.
According to Eunice Biritwum, CEO of the independent power producer, CENIT Energy Ltd, efforts currently underway within the sector such as the raising of the energy bond to resolve the indebtedness in the energy sector followed by the implementation of the cash waterfall mechanism and private sector participation in the industry would all help to improve the operations of the sector.
“As a local investor in the power sector, CENIT Energy believes that we need to empower indigenous power producers to put in the much-needed infrastructure that the economy needs for growth. “We need indigenous power generators to trigger rapid development,” she said, “and furthermore there must be a deliberate plan for generation additions, going forward, with private sector participation”.
According to her, there are people who want to invest in the energy sector and for that reason, the government must help to provide a bankable credit security and seed funding for indigenous project developers.
She also stated that “ECG as a distribution company needs Government’s assistance to clean its balance sheet and improve the regularity of payments to power producers and to improve its status as a credible wholesale off-taker.
