Minister-designate for Energy, Boakye Agyarko, has underscored the need for wider stakeholder consultation in the deal to support the Electricity Company of Ghana (ECG) under the second compact program.
He said the opposition to the deal between the government of Ghana and the United States mainly by workers of ECG is because the workers were poorly engaged.
“Any socio-economic project that starts off with a lot of tension, anxiety and anger does not end well in its implementation,” he said.
He was speaking Monday during his vetting at in Parliament.
The unionised staff of ECG have been kicking against the concessional arraignment for ECG, saying it is an attempt by the government to hand over the entity to a foreign firm, adding what was happening was a disguised privatisation of ECG.
Ghana signed the Power Compact with the United States of America acting through the Millennium Challenge Corporation (MCC), an independent United States government agency, on the sidelines of the US-Africa Leaders’ Summit in Washington DC on August 5, 2014.
The agreement provides Ghana with a grant $498,200,000 to improve the performance of Ghana’s power sector, unlock the country’s economic potential, create jobs, and reduce poverty.
About $350 million of the grant is being invested in ECG to make the country’s power distributor operationally and financially more efficient.
Commenting on the deal in Parliament, the incoming Energy Minister said there is the need to forge a common ground between parties opposed to the deal and those pushing the deal — mainly the governments of Ghana and America — for implementation of the deal to sail through smoothly.
“Let us take on board all the pressure that has been raised by ECG workers, civil society and others and let us see if we can find common ground to reduce the tension, remove some of the misconceptions so the project can go on,” said Boakye Agyarko.
About six firms have been shortlisted to manage the whole concession arraignment for ECG.
They include Manila Electricity company from the Philippines, Tata Power company from India/UK, Engie Energie Service from France, Enel S. P.A from Italy, BXC Ghana Limited from Ghana – China, Manila Electric from Philippines, Tata Power Company – India, and CH group, EDF, SA, a joint bid made up of a Ghanaian firm and France.
The firm that gets the nod, will be required to invest a minimum of $100 million over the next five years.
According to the Millennium Development Authority (MiDA) there should be a new concessionaire by the third quarter of 2017 to manage ECG operations.
The project fund is estimated to be about $535.6 million and it is divided into three – a programme funding of $469 million, a compact implementation funding of $29 million from the United States grant of $498 million and a government of Ghana contribution of $37.4 million.
The Program consists of six Projects:
(i) ECG Financial and Operational Turnaround Project;
(ii) NEDCo Financial and Operational Turnaround Project;
(iii) Regulatory Strengthening and Capacity Building Project;
(iv) Access Project;
(v) Power Generation Sector Improvement Project; and
(vi) Energy Efficiency and Demand Side Management Project.
Third Compact
Chief Executive of the Millennium Challenge Corporation (MCC), Dana Hyde, has said although it might be early days into the second Compact, there is an active process to ascertain whether it is be prudent to look at regional power sector support rather than a third Compact based on bilateral arraignment with a country.