The Deputy Minister of Energy, Andrew Agyapa Mercer, has disclosed that the Energy Ministry is working to ensure that all debts in the energy sector is cleaned up.
Speaking on the debt the energy sector is facing, he averred that new rules have been rolled out with regards to how the ministry’s contracting process is going to be to help prevent debt.
“We are working with a framework to ensure that all these debts and obligations that are in the energy sector is cleaned up. I am positive that with the comprehensive implementation of the plan, we would be able to get out of the woods and put our energy sector on some footing”.Andrew Agyapa Mercer
He also revealed that the Energy Ministry as part of efforts to reduce the debt, is implementing the energy sector recovery program, which clearly spells out what the debt burden of the sector will become if nothing is done to prevent it.
“I am sure that you’ve heard that there is some projection that the ‘do nothing’ scenarios will put out about some 125 billion dollar by 2023. But of course we are not putting up the do nothing scenarios we are actually working to ensure that the energy sector recovery plan that we have putting place is implemented fully”.Andrew Agyapa Mercer
Agyapa Mercer indicated that the Energy Ministry is also working to ensure that all the things that are needed to do, for example the “project light”, negotiations are still ongoing to ensure that the burden in that space is significantly reduced.
Scrapping taxes has consequences
Touching on National Democratic Congress’ request to government to scrap taxes on fuel, he stated that it’s just an attempt to receive as much approval from the public regardless of its consequences.
According to Andrew Agyapa Mercer, it is unjust for the opposition party that contracted Power Purchasing Agreements, he described as reckless that have negatively impacted the coffers of the country, to go around and make such demands from government.
The deputy sector minister noted that it was recently in 2020 that government utilized 5megawatts of the additional capacity contracted. However, government, he said, keeps paying year on year all the cost that are associated with those Power Purchasing Agreement that had been signed.
“If you listen to the government that when they were in power contracted all these obligations that have to be paid for, turning around to suggest that scrap all taxes and levies then one begins to wonder whether they are being altruistic in their comment or that it is just playing to the gallery just to create a certain impression to exploit in a deceptive manner for political gain”.Andrew Agyapa Mercer
Commenting on the state of the country’s energy sector, Mr Agyapa Mercer noted that the revenue government accrues from imposing taxes on petroleum products goes to finance the huge cost the country has to bear for signing the Power Purchase Agreements.
“When the Minister of Finance read the budget in March of this year, some of those taxes and levies that are being imposed on petroleum is being used to service debt that the power sector has had to deal with. Today, the short fall in ECG’s revenue as opposed to the cost that it incurs in ensuring that power gets to our home is in excess of USD1billion. That debt has to be paid. It is cumulative”.Andrew Agyapa Mercer