Mr Elikplim Kwabla Apetorgbor, Chief Executive Officer (CEO) of Independent Power Producers (IPP) has called on the government to support the energy sector to prevent it from the brink of financial collapse.
According to him, the sector was at the heart of its crises with the Electricity Company of Ghana (ECG), a critical player in the electricity power supply value chain but struggling to raise the necessary revenue to meet its obligation to IPP and fuel suppliers.
Mr Apetorgbor, in an interview with the Ghana News Agency, stated that the ongoing inability to pay debts was driving the energy sector into a vicious cycle of debt accumulation, technical losses, energy insecurity, and energy disruption.
‘Unlike natural gas, the pricing is more stable and often determined by long-term contracts. Liquid fuels are purchased on the international market where prices fluctuate frequently, so we need government intervention to address such challenges, ‘he stated.
He added that as the government pursued profit thro
ugh fuel, other procurements carried financial consequences with environmental costs, to be treated urgently to boost the energy sector.
Mr Apetorgbor said the stability of natural gas prices was often determined through a long-term contract that provided an added layer of financial predicament to allow ECG to fix better plans on its revenue streams to meet its obligations to IPPs and to ensure a more stable supply of electricity for consumers.
‘It is not only cheaper to produce electricity from natural gas, but it is also cleaner, emitting up to 50 per cent less carbon dioxide as compared to oil-based fuel.’
He added that to break the financial load that the government’s liquid fuel procurement strategy had placed on the energy sector, bold reforms such as prioritisation of natural gas and enforcing cost-reflection tariffs should be considered.
Dr Apetorgbor said the energy sector needed active regulations and oversight of fuel procurement processes to eliminate the opportunities for excessive markups an
d profiteering with a transparent and competitive bidding process to ensure that Ghana gets better prices on its fuel imports.
He advised that the government in the long term should prioritise investment in the renewable energy sector by introducing solar and wind energies that remain environmentally friendly with the hedge against the volatility of the fossil fuel market.
Some individuals have also appealed to the government to address the energy challenges since ECG remained the backbone of electricity supply to generate the needed revenue or economic growth.
Source: Ghana News Agency