$1.6bn Debt: IPPs want 30% part-payment by June 30
Independent Power Producers (IPPs) in Ghana have issued a stern warning to the government, setting a deadline of June 30, 2023, for the payment of a minimum of 30% of the $1.6bn outstanding energy debt. The decision was made during an emergency meeting held on May 23, 2023, in a bid to alleviate the mounting pressure faced by members of the Chamber of IPPs, Bulk Consumers, and Distributors.
This ultimatum aims to ensure the continuous operations of these power producers while negotiations with the Electricity Company of Ghana and the government continue to seek a long-term resolution to the ongoing payment crisis.
In a statement addressed to the Finance Minister, Ken Ofori-Atta, the Chamber of IPPs emphasized the criticality of receiving the requested payment by the agreed-upon date. Failure to do so, according to the statement, would render the IPPs unable to guarantee the sustained generation of electricity. The implications of such a situation would be significant, given the vital role played by independent power producers in the country’s energy sector.
The Chairman of the Chamber of IPPs, Togbe Afede XIV, expressed regret over the necessity of issuing this ultimatum, emphasizing the urgent nature of the request for payment. The hope is that the government will recognize the gravity of the situation and take the necessary actions to avert a potential disruption in the generation of electricity.
Prior to this ultimatum, the Independent Power Producers, Distributors, and Bulk Consumers had already warned of their intention to cut power supply to the national grid by the end of June 2023 if the government failed to settle its outstanding debt. Such a move would have severe repercussions, as the IPPs currently account for more than 65% of the available thermal generation capacity in the country.
The threat of a power shortfall looms large, highlighting the urgent need for the government to address the energy debt issue. The potential consequences of a disruption in power supply extend beyond the immediate impact on consumers; they would also have far-reaching implications for various sectors of the economy that rely heavily on a stable and consistent power supply.
As negotiations continue between the independent power producers, the Electricity Company of Ghana, and the government, all stakeholders are acutely aware of the pressing need to find a comprehensive and sustainable solution to the payment crisis. The resolution of this issue will not only ensure the continued provision of electricity but also contribute to the overall stability and growth of the Ghanaian economy. The coming weeks leading up to the June 30 deadline will be crucial in determining the path forward for the energy sector and the resolution of the outstanding energy debt.
