AMERI back again: Gov't trumpets savings after review but minority laughs off claim

AMERI back again: Gov't trumpets savings after review but minority laughs off claim
Source: Ghana|Myjoyonline.com|Nathan Gadugah
Date: 26-07-2018 Time: 03:07:35:pm
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Boakye Agyarko Energy Minister

Government has renegotiated the controversial Ameri power deal claiming the new deal will save the country a whopping amount of $400 million over a 15-year period.

Under the new agreement, a new company- Mytilineous International Trading Company will take over the management of the Ameri power plants for 15 years.

The new company has offered to pay Ameri an amount of $52,160,560.00, with government paying the remaining $39 million to the Dubai based company so they can wash their hands off the deal entirely.

The agreement covering the new deal was brought to Parliament Thursday, for approval.

Background

The $510 million Ameri deal was signed between the Mahama led government in 2015 at a time when the country was reeling under a heavy power paralysis.

The deal was to shore up Ghana’s power supply and to help solve what became known as the return of “dumsor”- power outages.

However, the deal triggered a well of controversy with civil society groups including IMANI, ACEP raising issues about the cost of the power plant.

According to IMANI, the deal had been inflated by over $150 million and demanded that government abrogate the deal.

Vice President of IMANI Kofi Bentil said the then government officials paid a whopping $150 million to a middleman for little or no job done.

But officials of the Mahama led government were adamant in the face of criticism.

Deputy Power Minister at the time John Jinapor justified the agreement saying, the $510 million was for a period of five years which is not the same as paying for a product on a shelf.

He argued that even if the cost of the plant is $350 million, in five years the cost of the plant would have shot up to $625million, insisting it made economic sense for the government to pay $510 million for five years.

The then opposition New Patriotic Party was not left out of the controversy, accusing the Mahama led administration of price inflation.

It promised to review the agreement if it won power and shortly after it did, the Akufo-Addo led government quickly set up a 17-member committee led by Philip Addison, a lawyer, to investigate the details of the agreement.

The committee among other issues, advised the government to review the agreement with Ameri company.

The review has been done and a new agreement has been brought to Parliament for approval.

Joy News’ Parliamentary correspondent Joseph Opoku Gakpo reported the Energy Minister as saying the new agreement is in the best interest of the country.

According to the agreement, the price at which government will now buy power will be reduced from 14.5919 cents to 11.7125 cents per kWh which will lead to a savings of $405.067 million.

“The drop in tariff of US cents 2.8793 per kWh has resulted in a yearly cost savings of about $27.004 million. The total cost of savings over the 15 year period is $405.067m,” the new agreement said in part.

Opposition

Joseph Opoku Gakpo reported the Minority as saying the new agreement is terrible.

They said the deal will make Ghana pay double the amount for the original contract to AMERI.

Minority Spokesperson on Energy Adams Mutawakilu disputed the claim by government that the new deal will save Ghana $400 million.

He said the new deal will rather make Ghana lose money and the old deal should have been allowed to stay.

“There are a lot of questions for the minister to answer. This agreement will be worse. They say ours is worse. Theirs will be terrible,” he said.

He said the cost will be about twice what AMERI was claiming.

“The old deal was perfect and that is why the Attorney General vindicated us,” he said.


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