A move by the Akufo-Addo government to enlist the Ghana Grid Company (GRIDCo) and the Volta River Authority (VRA) on the Ghana Stock Exchange is a step in the right direction, Michael Adumata-Nyantakyi, Chairman of the Public Utilities Workers Union (PUWU), has said.
In his maiden State of the Nation address on Tuesday February 21, President Akufo-Addo told parliament that as part of fixing problems in the power sector, his government had initiated a process to develop a national electricity masterplan, which will also explore the possibility of listing VRA and GRIDCo on the stock market.
According to him, his predecessor John Mahama left behind a heavily indebted energy sector.
“The attempts by the previous government to resolve the ‘dumsor’ crisis have led to a gargantuan debt overhang in the sector,” Nana Akufo-Addo said.
“We have inherited a heavily indebted energy sector, with the net debt reaching $2.4billion as of December 2016. I have to point out the alarming fact that $800million of this debt is owed to local banks, which threatens their stability.
“Huge indebtedness of the energy sector constitutes the single major hurdle to Ghanaians enjoying reliable and affordable electricity supply. The cost of energy destroys businesses large and small. It destroys jobs. It compounds poverty. The current state of the energy situation in our country is unsatisfactory. My government will enforce the procurement law. We will insist on open and competitive bidding for power capacity procurement.”
Speaking on this matter in an interview with Chief Jerry Forson, host of Ghana Yensom, on Accra 100.5FM on Wednesday February 22, Mr Adumata-Nyantakyi said: “We know that when we talk about energy in this country, right from the previous government to this government, all the attention goes to the Electricity Company of Ghana (ECG). But if all of a sudden the current government is saying that GRIDCo and VRA will be enlisted on the Ghana Stock Exchange (GSE), we will need the details of the thinking that informed that decision for us to make a good assessment of how that move will affect the whole energy sector.
“One thing that we at PUWU have consistently said is that if only the enlistment of these institutions on the Ghana Stock Exchange will help for national development and also provide opportunities for Ghanaians in the form of ownership to improve on efficiency, then it will be in a step in the right direction.
“Unbridled privatisation [of state organisations] is what we have issues with sometimes. When you visit a number of both developed and developing countries, many of the utility companies that are performing very well are nationally owned, the government has majority ownership. We have always said that the main issues affecting the energy sector in Ghana is leadership and political interference. If we are able to deal with these two issues, the energy sector in Ghana will be one area that can help generate a lot of revenue for national development.”