The Minister for Energy and Green Transition, John Abdulai Jinapor, has indicated that greed and political interference led to the collapse of the Power Distribution Services (PDS) deal.

Speaking at the Government Accountability Series in Accra on Wednesday, July 16, Mr. Jinapor noted that private companies becoming a third party in the country’s electricity distribution services was not the issue.

However, the selfish decision by certain individuals corrupted the whole process.

“We are not going to use the PDS approach in bringing in the private sector. PDS was not a bad approach in terms of private sector involvement. The only bad thing was that a few greedy individuals decided to cannibalise the process and to sell the shares among themselves,” he said.

The PDS scandal traces back to October 2019 when the Government of Ghana abruptly terminated a concession agreement with Power Distribution Services (PDS) Limited. This agreement had involved the takeover of the Electricity Company of Ghana’s (ECG) assets for electricity distribution across southern Ghana.

The termination followed a forensic audit by the Millennium Challenge Corporation (MCC), which revealed serious breaches of contract and concerns over the integrity of the process.

In 2014, the Government of Ghana signed a Millennium Challenge Compact with the MCC, aiming to stimulate private-sector investment in the power distribution sector. Meralco, a company based in the Philippines, was selected as the concessionaire through an international tender process.

To meet Ghana’s local content laws, Power Distribution Services (PDS) Limited was established, with Meralco holding a 30% stake and various Ghanaian and Angolan entities holding the remaining shares.

As part of the agreement, PDS was required to meet 41 conditions precedent, five of which were critical for ensuring transparency and protecting Ghanaian taxpayers. Among these, Conditions Precedent 24 and 31 mandated that PDS provide payment securities in the form of a Demand Guarantee or a Letter of Credit issued by a qualified bank.

However, the audit revealed that PDS secured an insurance guarantee instead—allegedly facilitated by a meeting chaired by ex-Vice President Dr Mahamudu Bawumia.

A group of concerned Ghanaian citizens formally petitioned the Office of the Special Prosecutor (OSP) to investigate Dr Bawumia

The petitioners' request to the Special Prosecutor highlights a key meeting, reportedly chaired by Dr. Bawumia, where the decision was made to accept a downgrade of the required bank guarantee to an insurance guarantee.

This meeting was also reportedly attended by the Chief of Staff, the Minister of Finance, and the Minister of Energy.

The petition alleges that this decision led to the eventual transfer of ECG’s assets to PDS under questionable circumstances.

The insurance guarantee in question was purportedly issued by Al Koot Insurance and Reinsurance, a Qatari firm.

However, subsequent investigations revealed that the guarantee was fraudulent, with the signatory, Yahaya Al Nouri, lacking the authority to bind the company to the deal. Despite this, the transfer of ECG’s assets proceeded, violating the agreement's terms and international best practices.

The petition further outlines the financial losses Ghana suffered due to the botched PDS deal. The audit report revealed that PDS’s local shareholders spent approximately $12.25 million to procure the fraudulent insurance guarantee, with $4.25 million allegedly taken from ECG’s operating accounts after the illegal takeover of its assets.

The termination of the PDS agreement also resulted in Ghana losing $190 million in funding from the Millennium Challenge Corporation, which was intended for critical infrastructure and financial recovery in the energy sector.

In their petition, the citizens call on the Special Prosecutor to investigate Dr. Bawumia’s involvement in the decision to downgrade the payment security requirements, which they argue directly led to the fraudulent acquisition of ECG’s assets by PDS.

They also demand an investigation into the circumstances surrounding the entire PDS deal, including the misuse of $4.25 million from ECG’s accounts and the overall cost to Ghanaian taxpayers.

The petitioners argue that under the 1992 Constitution of Ghana and the Office of Special Prosecutor Act, they have the right to request such an investigation. They emphasize the importance of holding those responsible accountable to prevent similar occurrences in the future.