Ghana faces an imminent energy crisis this year if the government does not make funds available to meet the subsidized cost of energy production by the Volta River Authority (VRA), an official of the company has said. The official, who pleaded anonymity, told the Times yesterday that VRA was in dire financial straits as a result of selling power to the Electricity Company of Ghana (ECG) at a subsidized rate for the public to enjoy low tariffs. The source said currently, VRA was producing hydro power at four pesewas per kilowatt hour while the power plants produce at 28 pesewas. In spite of the cost, VRA was compelled to sell power to the ECG at six pesewas with the difference piling up as debt for the company. According to the source, the government in the past provided money to cover for the difference, lamenting that “this year’s budget to the energy sector made no mention of such money.” The official said the situation had petitioned the Public Utility Regulatory Commission (PURC) to take a second look at the tariff but both government and PURC officials always dragged their feet at the mention of tariffs for fear of public outcry. The source said VRA would have to continue to depend on crude oil, which was a major drain on its financial resources. He said power supply was affected whenever the VRA was found wanting in raising funds for the supply of crude oil which was usually done ahead of the needed time. Explaining why some communities would be deprived of power for a number of days this week, the official said the late arrival of 200,000 barrels of crude at the Tema terminal led to a shortfall of 30 megawatts from the usual 110 megawatts the Tema thermal plant has been producing. “In order not to over load the system, we decided to reduce electricity by 30 megawatts throughout the country by taking out power supply in pockets of communities from 6pp.m to 9p.m until the situation is restored to normalcy,” he added. The source said the ship has now berthed with the oil cargo and would take two days to be discharged and treated before being fed into the machines for production of power. The source said the 200,000 barrels of crude would last for about a month and the country risked experiencing frequent power cuts given the rate of VRA’s operational loss. Reacting to VRA’s concerns Mr Akwasi Sarpong, head of Public Relations at the Ministry of Energy told the Times that the Ministry had liaised with the Ministry of Finance to salvage the situation. “As at today, through the efforts of the Minister of Energy, the Ministry of Finance has directed that some funds should be released to VRA, to meet the subsidized cost of its energy production,” he said but could not readily say how much would be released. Mr. Sarpong recalled that in 2007 PURC reviewed the electricity tariffs and the government decided to absorb the deference. This was however not paid to the VRA. Source: Daily Graphic /Ghana