11 May 2015, Accra – The World Bank Group’s Board of Executive Directors has approved a $60 million International Development Association (IDA) credit for Ghana to improve the Electricity Company of Ghana’s (ECG’s) financial performance, minimise its commercial losses, and ultimately contribute to increased revenue and cash flow.
The credit provides additional financing to the Ghana Energy Development and Access Project (GEDAP), originally approved by the Bank Group’s Board on July 26, 2007, including $90 million and an additional $70 million approved on June 3, 2010.
The GEDAP funds have broadly supported Sector and Institutional Development; Electricity Distribution Improvement; Electricity Access and Renewable Energy; Expanded Capacity for Electricity Distribution Improvement; Revenue Collection Improvement; and Management and Planning Enhancement.
Most of this new financing will be used to increase the scope and impact of ongoing activities to strengthen ECG’s billing and metering systems to improve its operational efficiency, according to the bank.
As the agency responsible for managing the energy consumer accounts, the ECG’s performance has a major impact on the entire energy value chain. Ghana is currently experiencing a significant shortage of electricity.
Improving the ECG’s performance could help create better conditions for attracting private financing to generate desperately needed new power. This shortage of power is also curtailing economic growth and adversely affecting the profitability and sustainability of businesses.
Commenting on the deal, the World Bank Country Director for Ghana, Yusupha Crookes, said: “We are happy to be providing additional resources to support Ghana s energy sector, and it is our hope that ECG would use these resources to build much needed operational capacity, fix the bottlenecks hindering its smooth operation and financial stability, and deliver reliable and sustainable services to its customers.”
*Masahudu Ankiilu Kunateh – The Chronicle