Deputy Minister in charge of power, William Owuraku Aidoo has said President Nana Akufo-Add should be commended for taking a firm decision to terminate the concession agreement between the government and the Power Distribution Services (PDS).
The government officially began processes to terminate the PDS concession agreement on Wednesday after announcing its intent earlier in the week.
Speaking on Eyewitness News, Mr. Aidoo said although the termination will come with its own disadvantages, the government had to take the decision in the interest of Ghanaians.
“The President and his government decided that as far as we as a nation is concerned, the demand guarantee which is the condition precedent for this compact to be legitimate was not in place and I think the President should be commended for standing its ground.”
“We have been advised and have taken the advice of our advisers to be true…As far as we are concerned, the demand guarantee was not in place so we have taken a decision to safeguard the 3 billion dollars of our assets as opposed to the 190 million dollars predicated on successful completion of the concession. It is a decision that we have taken and there is no major fight between us [government and US].”
ECG takes over power distribution
This latest development has officially paved the way for the Electricity Company of Ghana (ECG) to assume full control of the electricity distribution business in the southern part of Ghana.
In a statement, the ECG said;
“The Electricity Company of Ghana Limited (ECG) has today, 23rd October, 2019 terminated Private Sector Participation Transaction Agreements with Power Distribution Services Ghana Limited (PDS). ECG has therefore assumed full operational and financial control of the electricity distribution business in the Southern Zone of Ghana with immediate effect. Consequently, all activities which were hitherto undertaken by PDS have reverted to ECG”.
Per the statement ECG will undertake the following: • Metering • Billing • Distribution of bills • Bill reconciliation • Revenue collection • New Service connections • Disconnections and reconnections • Faulty meter replacements • Network faults and repairs • Network Operations, Maintenance, Expansion and Rehabilitation • Complaints and fault reporting to the call centres • Any other related services
The government officially announced the termination of its power concession agreement with PDS in a statement dated Friday, October 18, 2019.
It said in the statement that the decision was taken at a meeting in the US with the Secretary to President Akufo-Addo, Nana Bediatuo Asante and officials of the Millennium Challenge Corporation.
Termination of PDS deal was unwarranted, $190m withdrawn – US
The United States of America had described the termination of the concession agreement with Power Distribution Services as unwarranted.
Despite the government’s claims of fraud in the deal, the US in a statement from its Embassy in Ghana insists that the agreement was valid.
“Based upon the conclusions of the independent forensic investigation, the U.S. position is that the transfer of operations, maintenance, and management of the Southern Distribution Network to the private concessionaire on March 1, 2019, was valid, and therefore the termination is unwarranted,” the statement read.
The termination of the deal also means Ghana will be losing out on $190 million.