Energy Expert Urges More Private Sector in Power Distribution

An energy expert is calling for more private companies to help manage Ghana’s electricity distribution system. This is seen as a way to fix the ongoing power outages. These outages are commonly known in Ghana as ‘dumsor’. The expert’s name is Lom Nuku Ahlijah. He believes private sector involvement is key to solving this problem.

Mr. Ahlijah spoke on a program called Prime Insight. He said that bringing in private businesses to manage parts of the system is not a new idea. It has been discussed for many years. For example, he mentioned a past deal with Power Distribution Services (PDS). This deal didn't fully happen. But it showed how private companies could work with the state-owned Electricity Company of Ghana (ECG). PDS was meant to handle the business side of electricity supply.

Ghana’s economy relies heavily on stable power. Frequent power cuts harm businesses and households. This affects production and daily life. The ECG, a government-run company, handles power distribution for a large part of the country. However, it faces challenges in delivering services efficiently. Mr. Ahlijah pointed out that ECG’s performance over the last decade has not solved the problem. He believes private companies are driven by profit. This motivation can lead them to find innovative ways to reduce waste and improve services. He thinks linking their pay to meeting specific goals for reducing electricity loss is a good strategy. System losses are the amount of electricity that is generated but not sold. This can be due to technical issues or electricity theft.

The current discussions are moving towards reorganizing ECG. One idea is to divide ECG’s vast operational area. ECG covers the entire southern part of Ghana. This is a very large territory. Dividing it into smaller parts, called concessions, could make management easier. Other companies could then manage these smaller segments. This could speed up improvements like upgrading old equipment. Mr. Ahlijah also acknowledged that labour unions, like the Trades Union Congress, are resistant to these changes. However, he insists that the results from ECG alone show a need for change. Private players should be part of the solution.

This call for private sector involvement comes at a critical time for Ghana’s energy sector. The country has faced numerous power supply issues over the years. These issues often disrupt economic activities. The proposal to break up ECG’s concession area and bring in private operators could lead to significant investment. It might also introduce new technologies and management practices. However, ensuring fair energy prices and reliable service for all Ghanaians will be crucial. The government will need to carefully consider how to implement these changes. They must also address concerns from labour groups. The success of such reforms will depend on strong regulation and clear performance targets for all parties involved. This could pave the way for a more stable and efficient electricity supply for the nation.