The Ghana Power Compact, also known as Compact II, entered into force on Tuesday, September 6, this year, the Millennium Development Authority (MiDA) has announced.
The compact would provide Ghana with a grant of $498,200,000 to improve the performance of Ghana’s power sector, unlock the country’s power sector, unlock the country’s economic potential, create jobs and reduce poverty.
Government has five years to implement the Compact programme through MiDA.
This means that the treaty signed on August 5, 2014 between the Republic of Ghana and the United States of America, represented by the Millennium Challenge Corporation (MCC), has become effective, and Ghana now has access to the programme funds.
Owura Sarfo, Chief Executive Officer (CEO) of MiDA, commenting on the development, said Ghana met all the conditions precedent to entry into force of the compact and submitted all the required documentation in that respect.
“We believe that six projects have been carefully designed to address the root causes of the unavailable and unreliable power in our country, which is inextricably linked to the economic development of Ghana and poverty reduction.”
ECG workers
Meanwhile, workers of the Electricity Company of Ghana (ECG) have expressed anger at the Millennium Development Authority (MiDA) for showing “gross disrespect” to them concerning the privatization of the company.
National Secretary of ECG Senior Staff, Patrick Benyemi, speaking recently in an interview with Joy Fm, said the dealings of MiDA regarding the decision to give the nation’s power distributor to a concessionaire have been shrouded in secrecy which would affect the country in the foreseeable future.
ECG workers embarked on 8-hour daily strike for two days after it had staged a three-day strike over treatment meted out to them by MiDA regarding negotiations on the privatization of the company.
Their bid to draw MiDA to the negotiation table was dealt a terrible blow Wednesday following the coming into force of the Ghana Power Compact II signed between the governments of Ghana and United States of America (USA).
He noted that before handing over the company to the concessionaire, it was agreed that a monitoring performance would be established but that has not been done.
There was also supposed to be a “tariff methodology” that has to be determined by the Public Utility and Regulatory Commission (PURC) but this has not been put in place either.
With the ECG worth over $1 billion, Mr Benyemi wants to know how much the concessionaire is bringing on board to help revive the company as claimed by government.
ACEP
In a statement, the Africa Centre for Energy Policy (ACEP) expressed worry about the effect of the strike by Electricity Company of Ghana (ECG) workers on consumers of electricity.
Since the declaration of the strike, consumers have gone through various challenges to access services from ECG.
“We find this unacceptable considering the effects of several years of erratic power supply already suffered by industrial, commercial and residential consumers.
“We are of the view that the reasons for the decision to put the company on concession are not in doubt. It is well known that ECG has not provided satisfactory services to consumers of electricity over the years.
“We also know that government’s interference in the company concerning appointments to the Board and management, as well as its indebtedness to the company are partly to blame for the current state of the company.”
Options
“We propose that if the workers are opposed to the concession option, government must consider other forms of privatization, particularly a transfer of majority ownership of share (at least 51 percent) in ECG to a strategic partner selected through an open and competitive process or offload the shares to be acquired through the Ghana Stock Exchange (GSE).
“It is important to note that the leadership of the workers has already expressed its support for the stock exchange option.
“This shows that we can make progress on privatization of the company if the government adopts our proposal.
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