Energy Minister directed to meet IPPs over $700m debt

Energy Minister directed to meet IPPs over $700m debt

The Energy Minister, John Peter Amewu has been directed by government to engage the six Independent Power Producers (IPPs) threatening to shut down their plants over debts owed them.

Six IPPs said PDS owes them over $700 million and will be forced to shut down their plants that supply the country 1,500 megawatts of electricity if the payments are not made.

The Minister for Information, Kojo Oppong Nkrumah on the Citi Breakfast Show said government has asked Amewu to immediately meet with the managers of PDS and the IPPs to find a way around the issue.

According to the Minister of Information, the attention of Cabinet was drawn to the situation last Thursday and the government is taking action on it.

“On Thursday night, this matter came to our attention while we were on Cabinet retreat to see how far we’ve come in the first half of this year on the very many deliverables before government and the Energy Ministry was instructed to quickly re-engage with PDS and the sector players to understand the nature of the constraint and to quickly move to resolve that complaint.”

The Minister further said the government is in the process of renegotiating various power deals some of which he said was resulting in the state paying $1 billion yearly for power even if it does not consume such power due to a take or pay arrangement in such contracts.

“The ministry is going to renegotiate some of these contracts so that we can lower what we pay to the IPPs,” he said.

Pay us or we will shutdown

While acknowledging the negative impact a shutdown of power plants will have, the IPPs said they are left with no choice since they cannot continue to be saddled with huge debts.

According to them, as at the time the Electricity Company of Ghana (ECG) was taken over by PDS, they were owed over $400 million.

They said ever since PDS took over, it has not paid them a dime, resulting in accumulation of another debt of over $300 million, bringing the total debt to over $700 million.

The companies – Sunon-Asogli Power (Ghana) Limited, BXC Solar Ghana, Cenit Energy Limited, Cenpower Generation Company Limited and Karpowership Ghana Company Limited – are members of the Chamber of Independent Power Producers and Bulk Consumers (CIPDIB).

 

Source: citinewsroom.com

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