Ghana is said to be preparing to merge a number of state-owned energy utility companies to ensure efficiency.
Kwadwo Nsafoah Poku, a member of the energy subcommittee of the ruling New Patriotic Party’s campaign team, disclosed this on the Key Points show on TV3 on Saturday.
Poku said that cabinet has approved a merger of Ghana Grid Company Limited (GRIDCo), Bui Power, the Northern Electricity Distribution Company (NEDCO), Volta River Authority (VRA), and the Electricity Company of Ghana (ECG).
He said the proposed mergers are aimed at ensuring supply efficiency and private sector participation in the running of these institutions.
The privatisation of GRIDCo and VRA, according to Poku cannot be “a wholesale sale of those entities” because of the technical and the monopoly role they play.
“There is a lot going on…NEDCo and ECG there is a cabinet approval for the two to be merged. Then there is also a cabinet approval for VRA hydro and BUI [power] Authority to become one. So you’re going to have BUI Authority and VRA as one entity.
“The government has stripped the VRA thermal as a separate entity,” he said, adding that when all the parliamentary processes are done, there will be a single entity representing Bui Power Authority and Volta River Authority.
“And we are going to have ECG and NEDCo as one entity and these are things that the government has given a cabinet approval for these processes to go ahead,” said He added.
He further indicated that the government must streamline the roles of an entity like the GRIDCo. According to him, this will allow for some form of privatisation but not necessarily “selling them 100 percent.”
“GRIDCo carries a dual function, there is the function of being the transmission company but also plays a role which is more like a market administrator which is the dispatch of power and also looking at all these other auxiliary technical willing that they do.
“These things need to be streamlined and if you are able to take some of these powers away from some of these institutions, it will be okay to privatise some of them not necessarily selling them 100 percent but be able to bring in private sector participation as a minority state on some of these institutions,” he said.
However, speaking on the same show, Edward Bawa, Minority Ranking Member on the Energy Committee of Parliament, cautioned against the attempt to privates some of the state-owned energy utility companies.
“For security reasons, you cannot privatise ECG, VRA and GRIDCo. You can make the private sector play a part, but you can’t hand over everything,” Bawa cautioned.
He said power generation for economic development is so vital that it cannot be placed solely in the hands of private entities.