CIPDiB petitions Gov’t to include USD$1.4 billion debt owed in mid-year budget

The chief executive officer of the Chamber of Independent Power Producers and Bulk Consumers (CIPDiB), Elikplim Kwablah Apetorgbor has petitioned government to factor in payment of about USD$1.4 billion debt owed them in the budget.

In anticipation of the Mid-Year Budget Review in Parliament on Thursday July 23, by the Finance Minister, an appreciable number of stakeholders from various sectors have joined in with various request and pleas to boost their industries.

Mr. Apetorgbor indicated that the Chamber is griping in pain over the recurring buildup of debt which is invariably forcing them to contract costly loans to sustain their generations.

Currently, the Chamber comprises of Sunon-Asogli Power (Ghana) Limited, BXC Solar Ghana, Cenit Energy Limited, Cenpower Generation Company Limited and Karpowership Ghana Company Limited.

 “As the Minister of Finance prepares to present to the nation how he intends to fund government activities for the remaining months of the year, we would like this budget to address specifically the debt that the government owes us. It has become very critical because we are seriously bleeding to fund our operations. As at 30th June, 2020, the cumulative indebtedness to the IPPs is about USD$1.4billion and it continues to accumulate”.

Elikplim Kwablah Apetorgbor

“Out of the 1.4 billion, 1.5 percent represents the unsettled legacy debt which dates from 2016. About 78 percent also represents the cumulative invoices from the PDS era till date and the remaining 20.5 represents the default claims with respect to our PPAs. We have been very supportive. Most of the time we have to go around to borrow funds to be able to support our power generation especially in these trying times. We cannot continue, so we want this Mid-year budget statement to address specifically how government intends to pay for these services”.

Additionally, he requested for the inclusion of measures to offset the current pitfalls with ECG’s revenues as it will expedite IPP’s delivery of products and service to ECG with payment being made on time.

“That is the critical challenge of the sector. IPPs cannot be responsible for the government’s subsidies and other obligations. ECG is not able to generate enough revenue to pay for these invoices. And how does government intend to do the cover up”.

Background

In July last year, the IPPs in a warning to government, threatened to plunge the country into darkness if they were not paid the monies owed them by Electricity Company of Ghana or the erstwhile Power Distribution Services (PDS).

A statement issued to that effect, said members of the chamber were owed a whopping sum of US$1.5 billion by the ECG. Few days after that caution, government, through the Energy Ministry and the EGC, released an amount of GHc200 million to pay part of the debt,

Speaking on the matter, the Chief Executive Officer of CIPDIB, Mr Elikplim Kwabla Apertorkpor said they were yet to receive further money from ECG.

The IPPs later described the part payment as, “nothing compared to their demand and the amount owed them”.

Currently, all the IPPs generate about 60 percent (about 2,600 MW) of the total generation in the country’s power sector.