Accra, Ghana, July 31, 2019//-I have followed with keen interest the implementation of the ECG Financial and Operational Turnaround Project; leading tothe Electricity Company of Ghana handing over operations of the company to the Power Distribution Services (PDS).
I have carefully perused all available information at my disposal and I’m more convinced that though the Project itself is worth pursuing, the processes leading to the selection of PDS was not only flawed and inimical to the interest of Ghana but has the potential of throwing the whole electricity value chain off gear.
For the record, Ghana signed the Power Compact with the United States of America acting through the Millennium Challenge Corporation (MCC), on the side-lines of the US Africa Leaders’ Summit in Washington DC on August 5, 2014 attended by H.E. President John Dramani Mahama.
Under the Power Compact, six projects were being implemented to address the root causes of the unavailability and unreliability of power in Ghana.
The projects included ECG Financial and Operational Turnaround Project, NEDCo Financial and Operational Turnaround Project, Regulatory Strengthening and Capacity Building Project and Access Project.
The rest are Power Generation Sector Improvement Project and Energy Efficiency, and Demand Side Management Project.
The private sector company was expected to turnaround the operations of ECG to make it profitable. In addition, the new concessionaire was expected to improve access to electricity while cutting down on waste in the system to block all leakages that drain the financials of ECG.
It is also worth mentioning that the entire selection process begun in a transparent and competitive manner with the overall objective of selecting a company with the requisite technological, financial, and operational know-how to manage the asset base of ECG in an efficient and productive manner.
This culminated in the shortlisting of about 6 companies following the Request for Qualification of the Management of, Operation of, and Investments in the Electricity Distribution Business of the Electricity Company of Ghana, on 9th May, 2016.
However, under the guise of promoting local content, the Akuffo Addo led governmenthas succeeded in altering the whole process and finally awarding the contract to a consortium of friends, cronies and party apparatchiks contrary to the original goals and objectives of the entire programme thereby putting the programme in a very precarious situation.
It is becoming clearer that Ghanaians have been given a raw deal, with the awarding of a key state institution such as ECG with assets worth Ghc 22 billion going away under some fishy and untidy circumstances.
Firstly, it is important to take a critical look at the Ghanaian partners in the whole consortium since the Government claims to be promoting local content.
From the evidence present to the select committee on Minces and Energy, one of the shareholders; TG Energy Solutions Ghana, which has 28percent shares in the Consortium of investors, making it the largest Ghanaian shareholder in the transaction has a questionable record as far as the energy sector is concerned.
The NPP Member of Parliament (MP) for Sekondi, Andrew Agyapa Mercer is a Director of this Company, Lawyer Sophia Kokor, of Danquah Institute is also a known Director of TG Energy Solutions Ghana.
Indeed one Mr. Philip Ayesu, owner of X Men Barbershop is the main shareholder of TG Energy Solution. From detailed checks conducted, this company lacks the technical expertise and financial capacity in the energy sector to manage a critical State owned company such as ECG with an asset value of over Ghc22 billion and a workforce of more than 6,000.
It is curious and mind boggling to note that at the time of filling documents, TG Energy solutions had no office or physical as per documents presented to the committee by MiDA. How can a company that has no office address obtain the highest shares in the Ghanaian structure?
It therefore came as no surprise that The scheduled takeover which was to have occurred on the 1st of February was postponed by the Millennium Development Authority (MIDA) due to what the authority described as lapses that needed to be clarified.
It is interesting to note that at the time of announcing what MiDA describes as a “preferred bidder” by Pamela Djamson-Tettey, Director, Communication and Outreach at MiDA all Tier One and Two companies pulled out following the alteration of the bid process, as if that was not enough BXC company was also disqualified by MiDA thereby making Meralco Consortium (a Tier three company) from Philippines the sole company participating in such a major project. The essence of a completive process was therefore not pursued to its logical conclusion.
Even more bizarre is the fact that the so-called Ghanaian companies were selected under very suspicious and clandestine processes long after Miralco which initially participated as a sole entity.
One cannot lose sight of major infraction in relation to some critical clauses in the Agreement. Article 2.23(g) states emphatically that Without limiting the rights of ECG pursuant to this Section 2.23, ECG and the Company shall, prior to the Transfer Date, jointly prepare an ECG monitoring schedule and protocol consistent with this Section 2.23 providing further detail on ECG’s planned monitoring of the Distribution System.
It is therefore shocking that the Akufo-Addo led Government failed to ensure that the Monitoring Schedule and Protocol Agreement which are key to ensure that the assets of ECG are monitored during the concession period were not executed. By this omission, ECG will not be in a capacity to ensure that its assets are well maintained by PDS.
Why would officials rush to push ECG into handing over the assets without ensuring that the critical conditions and clauses are met.
The concession in its current state will certainly not serve the interest of Ghanaians, it is highly inimical and should be reviewed immediately.
The concession if left in its current state has the potential of destabilising the whole energy sector with very serious consequences including rising cost of power and crippling of the power generation companies.
By John Jinapor, former Deputy Minister of Power and MP
