Saturday, May 21, 2022

Ghana suspends $580 Million power agreement with PDS

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Elvis Adjetey
Elvis Adjetey
Elvis Adjetey is an experienced African journalist who has worked with top media brands in Ghana where he is based.
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The government of Ghana has suspended a concession agreement it signed with the Power Distribution Services (PDS).

Ghana’s power distributor, the Electricity Company was taken over by the Philippines Meralco Consortium.

The takeover by the consortium known as Power Distribution Services, PDS Ghana Ltd took effect in March this year.

The PDS Ghana Ltd was expected to take charge of power distribution for the next 20 years.

The firm was to be the electricity service provider in all of the ECG’s operational areas most parts of the country.

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PDS took over the electricity distribution assets and operations of the Electricity Company of Ghana Ltd (ECG) under the Power Compact Two project with the US government.

The Philippines based utility provider Meralco partnered AEnergia SA, an Angolan company, and three Ghanaian Companies: TG Energy Solutions Ghana Limited, Santa Power Limited and GTS Power Limited to form the PDS which is 51per cent Ghanaian-owned as required by the Government of Ghana.

PDS was expected to invest some $580million over a period of five years and continue its investment year after year throughout the 20-year period of the concession.

But a statement issued  by Ghana’s Information Minister Kojo Oppong Nkrumah attributed the suspension to fundamental and material breaches of PDS’s obligation in the provision of Payment Securities (Demand Guarantees) for the transaction which have been discovered upon further due diligence.

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Ghana’s power crisis four years ago led to the government seeking funding to revamp the power distributor.

The impact of the power crisis was severe especially for businesses leading to job losses.

Ghanaian workers in the power sector however kicked against the privatization of the power distributor.

 

 

Source: Africafeeds.com

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