The Electricity Company of Ghana (ECG) was yesterday transferred officially to Power Distribution Services (PDS) Ghana Limited at a short ceremony held at the Electro-Volta Hall in Accra.
The private sector concessionaire, which won the bid to take over the assets and operations of the company, will be the electricity service provider in all of ECG’s operational areas in the Southern Distribution Zone of Ghana, effective 1 March, this year until 2039.
According to the concession agreement, PDS will invest $580 million over a five-year period.
This will be followed by yearly investments throughout the concession period while also a large proportion of the Millennium Challenge Corporation (MCC) Funding of $535.7 million will flow into the power sector.
Yaw Osafo Maafo, Senior Minister, in a speech, said electricity tariffs are expected to stay stable or even drop in real terms after the initial period of
“That is the promise that must be fulfilled. That is the challenge PDS must meet…They must demonstrate better response times when the consumer has challenges, and they must understand that we are all ready to support them to succeed. PDS must keep to all its undertakings under the agreement, especially the investment required to turn around the fortunes of the power distribution sector.”
Noting that without adequate electricity, government’s industrialisation drive which included the 1D1F programme would face challenges, he explained that under the compact I and II, the US Government and its people had given a grant of nearly $1.1 billion to Ghana towards improving the economy.
Prof. Yaa Ntiamoah-Badu, chairperson of the Millennium Development Authority (MiDA), which supervised the deal, in a remark, said significant progress had been made so far.
“Firstly, the concessionaire, Messrs PDS Ghana Limited has been procured. Secondly, following Cabinet and Parliament’s approval, mid-year last year, of the three main agreements related to the transaction, i.e. the lease and assignment agreement; bulk supply agreement and government support agreement, Ghana satisfied the conditions precedent to the initial Tranche II Funding disbursement of the $190 million, having met the deadline before the second anniversary of the compact.
“Ghana, thereby, secured the entire $498.2 million Millennium Challenge Compact (MCC) Funding. Lastly, we have met all significant CPs which have enabled us to meet the 1 March, 2019 transfer date.”
Stephanie S. Sullivan, US Ambassador to Ghana, also in a remark, said that the concession had been structured with the interests of Ghana’s present and future at heart.
“As of March 1, 2019, PDS will bring to bear the skills and capital of the private sector to the long-term management and operations of southern Ghana’s massive power distribution network, servicing the needs of four million customers, individual households and businesses alike.”
The ECG Financial and Operational Turnaround Project (EFOT) is among six projects under the second Compact of the MCC with Ghana.
(By Samuel Boadi)