The World Bank has reached an agreement with the government to halt sole sourcing for all new contracts in the energy sector. 

This is part of several reforms that it is helping the government to implement in the energy sector.

The decision is coming on the back of serious concerns about dealing with some challenges facing Ghana’s energy sector, especially revenue mobilisation, reducing waste and losses in power distribution, as well as limiting transmission losses.

There have also been concerns about the nature of contracts that have been signed with Independent Power Producers in the country.

The Country Director of the World Bank, Pierre Laporte disclosed this on PM EXPRESS BUSINESS EDITION, which will be aired on Thursday, December 21, 2023, with host George Wiafe.

Impact of agreement

The agreement between the World Bank and the government means that all contracts signed in 2024 and beyond must be done through competitive bidding.

Mr. Laporte is of the view that this may go a long way to address and address the problem of value for money in the energy sector and project execution.

“We believe that this arrangement may help in ensuring that Ghana get the best deal and value for money, when it comes to these energy contracts”, Mr. Laporte noted.

Signing of new contracts in energy sector 

There have been concerns about the government’s decision to sign new contracts, especially when in the past, it criticised the former administration about what it said was an “Over Supply of Power”.

However, Mr. Laporte said a power contract could be exempted if it is coming from sectors that require some fresh investments.

He advised the government to focus more on green energy as the cost of undertaking such projects is reducing.

On the extractive sector, Mr. Laporte said everything must be done to ensure that Ghana benefits from mining and oil contracts.