Interview: William Amuna
William Amuna is the Chief Executive Officer at GRIDCo.
What measures can be taken to ensure that power tariffs reflect the actual cost of generation?
WILLIAM AMUNA: Up until now, we have worked very carefully to ensure that we take a studied approach to increasing tariffs. We certainly do not want to have a situation in which a sudden rise in tariffs ends up making local companies uncompetitive, nor one that places a greater financial burden on households.
Ideally, the situation that we should be looking for is one that can guarantee cost-reflective tariffs, which not only enable us to operate, but also allow industries to function at a reasonable margin. Ultimately, we hope for a tariff adjustment, which would improve sustainability in the sector. This is something that we encourage, provided it is done correctly. However, regardless of the tariff environment, we have put in place plans for capital investment to ensure that Ghana has the infrastructure necessary to increase power generation, while also meeting demand in the years to come.
How would you rate Ghana’s overall transmission connectivity with other countries in the region?
AMUNA: The West Africa Power Pool is the best example of the push to improve regional connectivity, although it is very much a work in progress at the moment. Construction is currently on-going along the various transmission lines, which connect Ghana with the networks of other African countries. Eventually all of these lines will be linked.
Currently, there are lines from the western part of the country to Tema, which end up in Togo. Our utility counterparts in Togo and Benin are working to ensure that those lines will eventually be linked to Nigeria by the end of 2016 or early 2017.
There are also other initiatives currently underway. For example, we are also working on a line that runs from Aboadze in the western region of Ghana through Kumasi, Tamale to Bolgatanga, and which will eventually end up in Ouagadougou, the capital of Burkina Faso. Again, this is expected by the end of 2016 or the beginning of 2017, and is designed to allow the transmission of 100 MW to Burkina Faso.
GRIDCo is undertaking this project with a view to contributing to the modernisation and efficiency of Ghana’s transmission network.
To what extent will the Atuabo Gas Project improve the reliability of Ghana’s power supply?
AMUNA: When it comes to power supply, a key concern relates to the supply of fuel to the power plants. Ghana depends a lot on Nigerian gas, which has been quite unreliable in recent years. So, with additional supply from Ghana Gas, power delivery will be more efficient. With this additional supply we will have more control of the overall resource and more independence from Nigerian gas. With gas available from Ghanaian sources, it would be easier to allocate it directly to our own power plants, especially in the western region. By doing so, gas production will also help generate savings and facilitate a decrease in fuel costs. Accumulating more savings is the best strategy to update our systems so that our generators will last longer, and that they will be put under less operational stress, thereby reducing maintenance costs substantially.
What impact will the Millennium Challenge Compact (MCC) have on the transformation of Ghana’s electricity sector?
AMUNA: Currently, in Ghana’s electricity supply chain the distribution sector is possibly the weakest link. As a result, to improve the provision of supply is not just a question of increasing generation; we would also need a revamp of the entire distribution sector. We have high expectations that when the MCC comes into force, the distribution sector will see a significant improvement in the way that power is delivered.
This information was originally published by Oxford Business Group (OBG), the global publishing, research and consultancy firm, appearing in The Report: Ghana 2016. Copyright Oxford Business Group 2016. Published under permission by OBG. For economic news about Ghana and other countries covered by OBG, please visit: http://www.oxfordbusinessgroup.com/economic-news-updates