The CAUCUS FOR DEMOCRATIC GOVERNANCE-GHANA(CDG-GH) has released a press statement chastising government over what it calls “Power Purchase Agreement Scandals Under Nana Addo`S Government”
Below is the full press release
CAUCUS FOR DEMOCRATIC GOVERNANCE-GHANA(CDG-GH)
7th August 2019
THE POWER PURCHASE AGREEMENT SCANDALS UNDER NANA ADDO`S GOVERNMENT
The Caucus for Democratic Governance, Ghana (CDG–GH), has observed with shock, the flaws and corrupt manipulations in the Power Purchase Agreements which is crippling the energy sector in Nana Addo`s Government .
It all started in 2017 when Nana Addo and his Energy Minister Boakye Agyarko abrogated the AMERI Agreement. The original agreement negotiated by former President Mahama and wrongly criticized by NPP, has the following as basis :
Ghana was to pay $102 million for 5 years. The total payment is $ 510 million. After the 5years, the plant becomes State property.
When NPP took over power, they decided to renegotiate the agreement on the basis of so called “value for money”. The renegotiated agreement was as follows :
Ghana was to pay $75 million for 15 years. The total payment in this case, is $ 1.125 billion.
Comparing the renegotiated agreement to the original agreement, Ghana looses $615 million of the taxpayers money. Surprisingly the new agreement with inflated cost passed through cabinet and with Nana Addo`s signature was sent to Parliament for ratification. It was found to be fraudulent and so was blocked by Parliament.
Soon after this aborted create loot and share AMERI agreement, the President decided and insisted, in the face of several protest to sell ECG. To push through his interest, Nana Addo announced that Ghana had renegotiated to control 51% of ECG; in its negotiation with Millennium Development Authority (MIDA).
Prior to the transfer of ECG to PDS, the agreement demanded guarantees ; that is, the Lease Payment Security and the Bulk Supply Agreement (BSA) Payment Security, or letter of credit issued by a Qualified Bank. Power Distribution Services (PDS) however could not meet the requirement of the Lease & Agreement Agreement (LAA) and Bulk Supply Agreement (BSA). Indeed the letter of credit issued by the Qualified Bank was fraudulent.
Meanwhile, the Millennium Development Authority (MIDA) had nominated Miralco, the Manila Power Company to manage Electricity Company Ghana (ECG). Indeed the transfer to PDS went ahead even though the disbursement of the $500 million ECG privatization package under the Power Compact II agreement had not started.
The CDG-GH is therefore of the opinion that the Agreement should be cancelled. The display of inefficiency and lack of due diligence is crippling government activities and leading to irresponsible dissipation of taxpayers money. The Companies that took the 51% ( PDS), as I write have not paid even a cedi to the Government. Ghanaians are suffering. Last month, electricity and water rates went up. Fuel prises, transport fares and prises of food and goods have all gone up; and yet the Government does not seem to care.
Chief Convener CDG-GH
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