Minority Vice President in Parliament Dr. Mahamudu Baumier in a recent public speech challenged the claim that the government paid GH¢17 billion to provide additional powers arising from the “take or pay” deal.
According to the minority, the Vice President’s claim is untrue and therefore challenged him to provide evidence to substantiate the claim.
John Abdulai Zinapour, ranking member of the Mines and Energy Committee, issued the challenge while addressing a press conference at the Parliament House in Accra, in response to the announcement by the vice president at the Accra Business School that the energy sector “neo or pay” deal is the International Monetary Fund’s bailout for Ghana. (IMF) helped approach
The Vice President, speaking at the forum, gave four reasons why Ghana opted for IMF support and categorized his reasons into two internal and two external factors.
He named internal factors to include the energy sector, the “take or pay” deal and the banking sector clean-up, and blamed external factors on COVID-19 and Russia’s invasion of Ukraine.
However, Mr Zinapore said the Vice President, instead of showing leadership and integrity in the face of the current dire economic crisis, chose to blame the previous Mahama administration for the predicament.
He dared the Vice-President to give evidence that the GHC 17 billion was derived from so-called excess power taking or salaries.
“I am ready to step down as ranking member of the Mines and Energy Committee. I am speaking with conviction knowing that what the Vice President is saying is untrue,” he added.
Mr. Zinapore also explained that excess capacity is consumed when the plants are declared available, but the buyer is unable to take power from the plant. Reserve margin is not excess capacity but insurance should be in every country.
He cited for instance that the Electricity Company of Ghana (ECG) presentation to Parliament’s Committee on Mines and Mines showed that mismanagement cost the company about 900 million cedis from foreign exchange losses.
He clarified that the PURC set their levy at GH¢5.6 to the dollar but today the cedis have come down to about GH¢8.2 to the dollar, even saying without anything, only the mismanagement of the economy will incur a debt of about GH. ¢1 billion in a year.
“So, when the finance ministry pays for that deficit, you can’t add it up and say that’s extra capacity. Apart from that, due to political interference in ECGs, ECGs (Electricity Company of Ghana) Aggregate Technical and Commercial Collecting (ATCC) losses increased to 30 percent. So, when you look at the expenditure distribution presented by ECG, the sales revenue was estimated at GH¢7.3 billion, but they only collected GH¢5.3 billion leaving a deficit of GH¢2 billion.
“When you add GH¢2 billion to the foreign exchange loss of GH¢1 billion the debt goes to GH¢3 billion. So, if the Ministry of Finance pays for this GH¢3 billion, the Vice President cannot hurry…. Claim that this GH¢3 billion annual payment constitutes excess capacity, it is not excess capacity” he asserted.