The management of the Electricity Company of Ghana (ECG) is set to engage in discussions with independent power producer Sunon Asogli Power (Ghana) Limited on December 8 to explore possible payment arrangements for a $60 million debt owed to the power producer.
Sunon Asogli Power temporarily ceased operations on December 4, attributing the government’s delay in meeting its financial obligations to power plants as the primary reason.
However, the company decided to suspend its shutdown for a week following government assurances regarding the debt settlement.
The decision to halt operations stemmed from Sunon Asogli Power’s concern that the mounting unpaid bills had significantly impeded its operational capacity, rendering it unsustainable to continue without addressing the financial challenges.
In acknowledgment of the government’s assurance, Sunon Asogli Power noted, “Kindly confirm our understanding that we shall be paid an interim sum of $60 million in two tranches. The first tranche $30 million to be paid this week and the second tranche in the week of 11th December 2023.” The upcoming meeting aims to discuss the specifics of clearing the debt owed by the government.
Independent Power Producers (IPPs) have consistently raised concerns about the government’s outstanding debts to them. Despite various initiatives, including threats to suspend operations, there has been limited progress in resolving the issue. As of July 2023, reports indicated that the government’s debt to IPPs had reached approximately $1.6 billion.
The recent 1.52 percent reduction in electricity tariffs announced by the Public Utilities Regulatory Commission (PURC) has been deemed unacceptable by IPPs.
They argue that this reduction will adversely impact ECG’s efforts to restructure its debt. Dr. Elikplim Apetorgbor, the President of IPPs, has expressed concern that ECG will face challenges in repaying its debt.
