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POLICY bonds on the back of fuel levies to clear the pay,” Ofori-Atta said in a phone interview.
outstanding liabilities. This helped cut the “We’ve tried to keep the lights on for these
Easy electricity deal debt by half by early 2018, though more bonds four years.”
haven’t been sold because there isn’t enough
Ghana’s public debt increased to
backfires as Ghana now revenue to support them. 258-billion cedis by the end of June,
State-owned Electricity Company of Ghana equivalent to 67% of GDP, from 61% at the
owed $1.4bn has suffered an estimated annual revenue loss end of March. The government previously
said it will use $1bn of the $3bn raised from
of $580m due mainly to transmission leaks,
Ghana lured investors to its power industry to illegal connections and unpaid bills. Plans the sale of a Eurobond in February to help
end chronic electricity shortages with deals it to tackle the problem by introducing private producers refinance their commercial loans.
can no longer afford. investors under a US-funded aid programme
The deals’ terms require the government to failed to win approval. The company’s MD,
pay for electricity generated even if there’s no Kwame Agyeman-Budu, did not respond to
demand for it. The move helped Ghana end its multiple calls and a text seeking comment. POLICY
power crisis by 2016, boosting its generation Not much help is coming from the West
to about 4,600MW, well above national peak African Power Pool project, under which Kenya Power cuts
demand of 2,700MW. member countries could sell their excess
Debt owed to the power companies power to neighbours. While Ghana was blackouts duration by half
has grown, rising to $1.4bn at the end of a net exporter of 967MW of electricity to
June, more than doubling from $600m in other countries in 2019, further exchange on upgrades
July last year, according to the Chamber of is hindered until 2023, when current
Independent Power Producers, Distributors interconnection projects will be completed. Kenya Power has cut the amount of time
and Bulk Consumers. Its members may be The coronavirus pandemic pushed Ghana its customers are left in the dark by half in
forced to shut their operations, it said last further into financial straits. It responded the last four years, reaping from billions of
month. with more than 3-billion cedis ($519m) in investments on its electricity distribution
“Debt levels could rise even further,” unplanned spending that included providing infrastructure.
Samantha Singh, a Johannesburg-based Africa free electricity and water to citizens, tax Data from the Ministry of Energy shows
strategist at Absa Bank, said in an e-mail. “The waivers and credit to small businesses, a that the average time customers stay out of
potential increase in these liabilities could situation that made it difficult to keep up with power supply per month has reduced from
hurt government finances even further in a the debt repayments, according to finance four hours per month in 2016 to one hour, 40
time when they are already strained due to minister Ken Ofori-Atta. minutes in 2020.
Covid-19.” “When you have limited resources in a The data also show that response time to
When President Nana Akufo-Addo came Covid-19 environment you have to be specific outages has improved with the average time
to power in 2017, he started the sale of energy about what you’re paying and how much you customers are cut off supply to fix power lines

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