[ 2017-05-08 ]

World Bank blames sole sourcing for Ghana’s high power costs
The World Bank has blamed Ghana’s relative high
cost of power on the adoption of sole sourcing in
the granting of power purchase agreements under
the past NDC administration.

The Bank has also warned of some economic
consequences following the country’s inability
to sell off its excess power due to the high
cost.

The World Bank was compelled to cut back on its
financial support to the private participation in
the energy sector upon realizing that the country
had signed more agreements than required.

Currently the NPP is reviewing the agreements
whilst it is seeking to reduce the cost of power.

But the World Bank Country Director for Ghana,
Liberia and Sierra Leone, Henry Kerali says the
current government must limit sole sourcing in
agreements.

“One of the main challenges with a number of
PPAs that were signed was that they were not
through competitive processes but through sole
sourced arrangements which makes it difficult to
assess if they offered the best value for
Ghana,” he stated.

Mr. Kerali added, “The relatively high cost is
probably an indicator of the inefficiencies of
doing sole sourced projects…our recommendation
has always been to have a competitive process for
public investments.”

The Deputy Energy Minister, Dr. Mohammed Amin Adam
in a recent interview also told Citi Business
News that the government will subject all
agreements to competitive bidding at a time that
renewable energy producers are offered waivers.

Also, the government has since commenced its
decision to cap all power produced by Independent
Power Producers at 10 cents per kilowatt hour.

Energy sector analyst, Dr. Philip Adom however
suggested that such decision could largely be
influenced by a pro business argument with the
IPPs.

Source - citibsinessnews.com

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