Former Deputy Energy Minister, John Jinapor has challenged private legal practitioner and influential family member of the President, to provide evidence that government has cancelled some 11 Power Purchase Agreements (PPA) entered into by the Mahama regime.
“The NPP has saved Ghana over $7bn that we otherwise would have paid because John Mahama decided to sign us on for power we had to pay for even though we would never get to use!,” Gabby Otchere-Darko wrote on Facebook.
But in a statement on Monday, he rubbished Mr. Jinapor said Mr. Otchere-Darko’s claim that the said cancellation had saved Ghana an amount of $7.6 billion.
Mr. Jinapor said such comment only goes to show a “complete misunderstanding of the issues,” by the lawyer.
“It is important to point out that Power Purchase Agreements are mostly executed by the Off-Taker (ECG) and not the President as Gabby and the NPP are mischievously trying to portray.
“The critical question is – why have Gabby and the NPP failed to provide details of the said terminated PPAs (including the date they were signed, the annual capacity charges and the conditions thereof) for Ghanaians to make their own judgement.
According to him, the “Akufo-Addo government and the NPP have lost focus, hence their continuous resort to mendacity and sheer political chicanery.”
Below is the statement
PRODUCE DETAILS OF 11 PPAs GOVERNMENT CLAIMS TO HAVE CANCELLED. JINAPOR CHALLENGES GABBY.
My attention has been drawn to a Facebook post by Mr. Gabby Asare Otchere-Darko in which he claims that the Akufo-Addo Government has saved Ghana an amount of US$7.6 billion from the termination of some 11 Power Purchase Agreements (PPAs) entered into by the erstwhile Mahama Administration.
Ordinarily, I would have treated this contrived statement with the contempt it deserves. However, due to the closeness of Mr. Gabby Asare Otchere-Darko to President Akufo-Addo and the enormous political influence he wields, I deem it necessary to set the records straight.
On November 17, 2017, the Energy Minister, Boakye Agyarko informed the general public that the Ministry of Energy had made savings of US$7.6 billion from the termination of some 11 Power Purchase Agreements (PPA) over a 13 year period.
Soon after Boakye Agyarko’s resignation, the new Minister for Energy, Hon. John Peter Amewu disclosed a totally different figure at a press conference on Thursday, September 20, 2018.
At the said press conference, Amewu stated that the Ministry of Energy has made savings of $6.8billion from the termination of the same Power Purchase Agreements.
However, these claims were only recently discounted by the ECG (which is the off-taker and the signatory to the said agreements) at a presentation to the Parliamentary Select Committee on Mines and Energy.
It is therefore laughable that a government with over 120 Ministers will rely on a private citizen, Gabby Asare Otchere-Darko to churn out such vile propaganda.
On November 13, 2016, a Cabinet report on the Energy Sector prepared by the Ministry of Energy, the Energy Commission and the World Bank (IBRD and IDA) recommended the discontinuance of some PPAs which had failed to achieve financial closure.
Notable among the findings of this report was the failure by some of these IPPs to meet their contractual obligations, thereby prolonging the country’s Power deficit and challenges.
It is worthy of note that most of these PPAs could only become effective after certain condition precedents had been fulfilled.
The agreements needed to receive the necessary cabinet and parliamentary approvals with the accompanying Government Consent and Support Agreement (GCSA) which was later changed to a Put-Call Option Agreement (PCOA).
It is therefore preposterous for Mr. Gabby Asare Otchere-Darko and the NPP to come to the conclusion that the country has saved a whopping US$7.6 Billion by what they claim as “termination of PPAs”.
Clearly, that view is not borne out by the facts and reflects a complete misunderstanding of the issues.
It is important to point out that Power Purchase Agreements are mostly executed by the Off-Taker (ECG) and not the President as Gabby and the NPP are mischievously trying to portray.
The critical question is – why have Gabby and the NPP failed to provide details of the said terminated PPAs (including the date they were signed, the annual capacity charges and the conditions thereof) for Ghanaians to make their own judgement.
Clearly, the Akufo-Addo government and the NPP have lost focus, hence their continuous resort to mendacity and sheer political chicanery.
Rather than continuously whining about Ghana’s excess capacity, the Akufo-Addo government should focus on expanding national electricity coverage and the exportation of power to neighbouring countries.
Since assuming office, the Akufo-Addo Government has only managed to achieve a paltry 1% increment in national electricity expansion.
Even more disturbing is the fact that the expansion of our transmission lines from 161KV to 330KV which begun under the erstwhile Mahama administration with the intention to expand the exportation of power to Burkina Faso and other neighbouring countries has stalled under this Government. These are the vexed issues that should occupy government’s attention.
Finally, I would want to strongly suggest to the President that instead of the continuous lamentations, his government should take advantage of the additional generation capacity bequeathed to them by former President Mahama to propel their wobbling and floundering 1 District 1 Factory promise.
John Abdulai Jinapor
Former Deputy Minister of Energy and Petroleum