Ghana To Part-Privatise VRA Thermal Plants

Ghana’s state-owned power producer Volta River Authority (VRA) plans to sell off part of its equity in its gas and oil fired power plants, its chairman Kweku Awotwi said October 18.

Ghana's installed generation capacity in 2015 was 3,656 MW, of which hydro (all VRA-owned) was 1,580 MW, thermal 2,053 MW and solar 22.5 MW. There are several independent gas-fired plants in the country, some that are VRA-owned, and one that co-owned by VRA and Abu Dhabi's Taqa.

VRA, which was established in 1961, says its own installed capacity is 1,970 MW of which 60% is hydro.

Awotwi said the operation to sell down VRA stakes in thermal plants is in line with a strategy to restructure the power sector and optimise operational efficiency. Twenty firms have already shown an interest in acquiring the shares. He added: “VRA’s management of its hydro assets is world class but, for whatever reason, we’ve not been able to replicate that [efficiency] standard for the thermal assets.”

He said this has contributed to the increase in the Ghanaian power sector’s debt, now standing at $2.2bn, of which $1.2bn is owed to fuel suppliers and commercial banks. The remainder is owed by other participants such as Ghana Gas, GRIDCo, Asogli and Nedco. The government early last month selected Fidelity Bank and Standard Chartered Bank to raise $2.26bn to clear the sector’s debt.

Accra plans to separate the management of thermal power plants from that of hydropower plants, in order to try and improve the former’s profitability, said Awotwi. But VRA senior staff are unhappy, and their president, Cephas Duse, has declared that the operation would not solve the VRA’s problems, that they had not been consulted, and might strike to oppose the move.

Power generated in Ghana in 2015 was 11,492 GWh, split evenly between hydro (5,845 GWh) and thermal (5,644 GWh) which included gas, diesel and power from a Turkish-owned 64 MW floating powership burning heavy fuel oil.

Olivier de Souza