The Minister of Energy, Dr. Matthew Opoku Prempeh, has disclosed that the energy sector will no longer engage in a “take or pay” policy in energy capacity generation.

Updating the press on the progress in the energy sector, he indicated that the policy directive the Ministry has set going forward, is that it will only do “take and pay”, with every power purchase agreement that is going to happen. “So we will pay for the power that we take”.

“When we talk about keeping the lights on, what existed and what exists, though we’ve been trying to keep the lights on, are varying power purchase agreements that have led to excess capacity payments. Even though our government guarantees, all these contracts are still take or pay. Whether you need the lights or not, once the generator generated it, you have to pay.”
Dr. Matthew Opoku Prempeh

Speaking on the new steps the Ministry is putting in place to ensure there is constant power, Dr. Opoku Prempeh averred that the Ministry will ensure it increases the nation’s generation capacity as and when necessary. “We will also ensure that in our power mix, we will increase the amount of renewable energy or clean energy for that matter.”

The Energy Minister disclosed that the power tariffs will also be denominated in Ghana Cedis and no longer in Dollars. “Because since the year 2007, the foreign exchange transaction act under the Bank of Ghana ensures that all goods and services should be paid in the local currency.”

Energy sector challenge, a mini crisis- Dr. Sulemana — Engineers working on transmission lines

Nation’s peak demand hasn’t exceeded available capacity

Dr. Opoku Prempeh clarified that at no time has the nation’s peak demand exceeded the available power capacity generated. “So, when people start shouting that we don’t have enough to keep the lights on, that’s not the case. We have had enough generation system. It’s been either financial challenges that has not allowed us to pay for the fuel, or something else.”

Explaining why the nation has been experiencing power outages, Dr. Matthew Opoku Prempeh indicated that the Ministry earlier spoke to Ghanaians about the fact that there is currently a lot of ongoing works in the transmission systems which may necessitate putting the lights off at particular times. Due to that, ECG came out with a lot of load shedding programmes and the areas that will be affected, he added.

“The reason was simple, because of the fact that we have improved the transmission system a bit. The normal curtailment that should have occurred with the transmission outages was sometimes deferred or minimized by ECG bringing light from another distribution network.”
Dr. Matthew Opoku Prempeh

However, he intimated that works had to pause during the Christmas season last year because the Ministry didn’t want to keep part of the country in “Dumsor”. He stated that the recent power outages is due to the work which commenced on the 9th April, 2022.

Dr. Opoku Prempeh revealed that upgrade works on the transmission lines to reduce losses and increase transmission capacity is ongoing with some also completed. “And for some of the lines that we are changing, they are so outdated that they are congested and causing fire and increasing power outages in parts of the country.”