VRA, BUI Power and ECG Face Major Overhaul | By David Kwakutse | Energy Minister-designate John Abdulai Jinapor has unveiled a series of initiatives aimed at revitalizing Ghana’s struggling energy sector, which is currently grappling with a staggering debt of $3 billion. This financial burden has resulted from ineffective management practices and escalating interest on existing liabilities.
During his vetting by Parliament’s Appointments Committee on January 13, 2025, Mr. Jinapor detailed the government’s commitment to consolidating key players, specifically proposing the merger of the Volta River Authority (VRA) and Bui Power Authority into a single entity, the “Ghana Power Company.” He believes this merger will enhance operational efficiency by creating a holding company with three specialised subsidiaries focused on hydro, thermal, and renewable energy.
Currently, VRA and Bui Power Authority generate about 45% of the country’s power supply, and Jinapor assured stakeholders that privatization of these vital assets is not under consideration. He emphasized the importance of worker input in finalizing the merger plans, which he believes will maximize expertise and streamline operations, ultimately leading to reduced losses and improved efficiency.
Amid these structural proposals, Jinapor addressed the critical financial challenges facing the energy sector. Reiterating that the debt has surged from an estimated $2 billion to $3 billion, he dismissed exaggerated claims regarding the debt’s height, noting that it was officially validated by Parliament. Moreover, he highlighted that the Energy Sector Levies Act (ESLA) has raised approximately GH₵ 45 billion to manage this debt, but those funds have proven insufficient to fully address the financial crisis.
In addition to the merger, Jinapor also outlined a six-month timeline for developing a framework for private sector participation in the operations of the Electricity Company of Ghana (ECG). A proposed seven-member committee will comprise technical experts, legal advisors, financial analysts, industry stakeholders, and consumer representatives to evaluate global best practices in determining the future model for ECG—whether to pursue a concession model or full privatization.
He assured that the process will maintain transparency and mitigate political interference while adopting a competitive tender approach, prioritizing local content and incorporating Key Performance Indicators (KPIs) to ensure accountability.
Jinapor stressed the urgency of these reforms, stating that lessons learned from previous concessions will inform the government’s approach, highlighting the need for immediate action to improve efficiency and maintain the operational sustainability of Ghana’s energy sector.
David Kwakutse | VRA, BUI Power and ECG Face Major Overhaul
