President John Mahama has expressed interest in privatizing the final phase of power distribution in the country to scale up efficiency in the supply chain.
Speaking at his office on his first full day in the nation’s highest position since his inauguration yesterday, the president said he was going to work with international partners in order to undertake the task.
“Going ahead with privatizing the last point of distribution of electricity to bring in private sector efficiency is something that we want to take up again. We would like to speak with the World Bank to get the expertise to be able to do that.
“I spoke to the Americans during my last visit there. We met the Millennium Development Corporation (MDC) and I asked them if it was possible for them to reinstate the $190million that they had devoted to that aspect of it and they said that the door is not closed and so we need to pursue that discussion,” he stated.
The president said it would be alternatively helpful if the World Bank could fund the arrangement.
He was the view that the goal was to contribute to reducing the losses that the state incurred in dealing with the Independent Power Producers (IPP).
President Mahama noted that in the short term, his administration would ensure transparency by restoring the Cash Waterfall Mechanism (CSM) to stabilize the energy situation after which they could look at medium to long term reforms.
The Cash Waterfall Mechanism was introduced in April 2020 as part of the Energy Sector Recovery Programme (ESRP) to ensure fairness and transparency in distributing energy revenues among electricity distribution companies.
Two years ago, President Akufo-Addo directed revisions to the Cash Waterfall Mechanism (CWM) under the Energy Sector Recovery Programme due to ECG’s challenges in adhering to existing guidelines.
The objective was to enforce CWM guidelines and enhance its effectiveness. As part of this, the Public Utilities Regulatory Commission was tasked with appointing independent auditors for quarterly audits of Electricity Company of Ghana (ECG) and Northern Electricity Distribution Company (NEDCo) collections and disbursements to validate declared collections and ensure CWM compliance.
