Our balance sheet is now stronger after gov’t settled its debt – ECG MD

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The Electricity Company of Ghana (ECG) says government had “averagely paid GHC2 billion directly to ECG’s suppliers (i.e VRA, IPPs and GRIDCo) to defray the Government of Ghana’s indebtedness to ECG.”

This follows claims by the Minority that government had settled arrears owed the company.

Earlier this week, the Minister of Energy, John Peter Amewu, at a press briefing organized by the Information Ministry, said the government had paid GHS2 billion annually to cover its bills.

He also said that the payment of the debts has given government credit balance of GHS500 million to pay for electricity bills for January to April 2020.

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In a statement issued by ECG to clarify issues surrounding the government’s payment of debts, Managing Director, Kwame Agyeman- Boadu, also stated that, “It is important to add that GoG has also paid an amount of GHS4.14 billion directly to various fuel suppliers and power producers and is yet to be credited to GoG’S account under the ongoing reconciliation exercise.”

He also confirmed that the total government of Ghana’s account as at the end of 2019 had been credited with 505.8 million cedis.

And with this, “it is enough to clear the first quarter of the government’s 2020 bill which averaged 100 million cedis monthly.”

The company extended its appreciation to the government for its intervention, saying the “company’s balance sheet is now stronger than before.”

Background

Earlier this year, the opposition National Democratic Congress (NDC) at a Policy Dialogue Series, alleged that Ghana’s energy sector is struggling due to a GH¢15 billion debt.

A former Deputy Power Minister, John Jinapor, blamed the prevailing situation on the mismanagement of the sector by the current administration.

But the National Patriotic Party in a response, attributed the increased debt in the energy sector to some policy decisions approved by the NDC government.

According to them, in January 2017 when the NDC handed over power, the Bulk Oil Storage and Transport Company Limited (BOST) owed $624 million to suppliers, Bulk Oil Distribution Companies (BDCs) and related parties in respect of crude oil imports for processing at TOR, as well as refined products which got lost from BOST tanks.

The government says the Energy Relief Package to offer some relief to Ghanaians following the economic challenges caused by the outbreak of the novel Coronavirus will not affect the country’s energy sector debt.

Government has announced a complete waiver of electricity bill for lifeline consumers of electricity and 50 percent reduction for all other consumers using March 2020 bill as the benchmark.

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Source Author: Nerteley Nettey