Africa Centre for Energy Policy (ACEP) has applauded government’s decision to transfer the Electricity Company of Ghana (ECG) to a private company, but takes strong exceptions to some aspects of the agreement.
Even though the decision was met with fierce resistance from sections of the public, particularly from some workers of ECG, ACEP believes the decision is a good move.
“Government’s decision to release ECG from its grips is a bold one. Both NDC and NPP have shared in this resolve to ensure that the off-taker of power generated is viable, credible and sustainable,” ACEP remarked.
ACEP said the initiative will breathe a new life into the distribution segment of the electricity sector.
However, ACEP has some reservations regarding taxation, data monitoring, procurement processes and other key parts of the entire Power Purchase Agreements (PPAs).
List of portfolio PPAs not presented to Parliament
ACEP argued that even though the schedule provided for the list of portfolio concerning the Power Purchase Agreements (PPAs) to be transferred to the company, the document presented to parliament for approval did not contain the list of portfolio on the PPAs.
It maintains such omission does not provide certainty on the plants that have been agreed to constitute the portfolio.
“Given that any existing PPA that is not captured in the portfolio will be paid for by citizens, parliament should know the generation plants that constitute the portfolio PPAs,” ACEP stated.
ECG is not a tax collecting entity
ACEP again argued that Section 6 of the Bulk Supply Agreement (BSA) provided that the company should pay all Value Added Taxes (VAT) and National Health Insurance Levies (NHIL) that had arisen in connection with the transactions contemplated under the agreement to ECG.
According to ACEP, the provision confers on ECG a role Ghana Revenue Authority should play.
“Similar provision is in section 2.1 of the Government Support Agreement. This confers on ECG tax collection duties from the company. The Ghana Revenue Authority (GRA) should be able to collect and assess taxes due under this agreement,” ACEP observed.
The need for the public to monitor the concession
ACEP again raised concerns about the opportunity of the public to monitor data of the concession. In ACEP’s view the public should be able to monitor all transactions of the concession.
“There is the need for the public to be part of the monitoring of the concession agreement through availability of data,” ACEP noted.
By Steve Lissassi|3news.com|Ghana