Government should not succumb to take or pay agreements – Dormaa East MP

The government has been urged not to succumb to take or pay agreements with power companies.

According to Member of Parliament for Dormaa East, Paul Apraku Twum Barimah, such agreements should not be considered by any government again in the life of the country since it is capable of draining the coffers of the state.

In an interview with the media, Mr. Twum Barimah commended the Energy Minister, Dr Mathew Opoku Prempeh for ending all take or pay contracts that were signed during former President John Mahama regime.

Mr. Twum Barimah who is an energy specialist said it does not make sense in the 21st century for any leader or government to deliberately sign an agreement that drains the resources and wealth of the country.

“Akufo-Addo has a vision of providing safe, reliable energy for the country in a bid to meet its energy needs for domestic consumption and industrialization. He said the era of negotiating power purchase agreement in emergency situations and during hard economic conditions should be a thing of the past and not be repeated.”

He pointed out that Ghana was estimated to have lost about $4.102 billion between 2014 and 2020 from the signing and implementation of the take or pay power contracts as it did not use the power, adding the huge chunk of money could have been channeled into developing the Ghanaian economy.

Last month, the Energy Minister announced that government would no longer sign take or pay Power Purchasing Agreements.

The Minister explained that the decision is saving the country an annual cost of $586m dollars spent on unused electricity purchased by the country.

He further described the 40 Power Purchasing Agreements signed under former President Mahama administration amid the power crises, between 2013 and 2015, as costly PPAs that caused power tariffs to increase by over 200%.