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Energy Deficit in Ghana –
Matters Arising
By Kwesi Atta Sakyi
December 26, 2014
Ghana, with a population of 24 million people, depends
largely on four to six main sources of energy for domestic,
commercial, and industrial consumption. These are
hydro-power from water, thermal electricity from diesel,
petrol, gas, coal, wood, and kerosene. We depend much on
hydro-carbons and fossil fuels for transport, as well as raw
energy from charcoal and wood for domestic use in the rural
areas. Alternate forms of energy supply such as wind farms,
tidal, solar, and geothermal sources are not yet popular in
Ghana.
In 1966, the Akosombo Hydro-Electric Power (HEP) Dam was
commissioned. It was started by Nkrumah to supply the bulk
of the power (60%) to the VALCO Smelter in Tema which was
into aluminium processing from our bauxite mined at Awaso,
Yenahin, Bibiani, Abontiakoon, among others, thereby adding
value to our exports. The Dam was constructed by Impregilio
Company of Italy, while the Smelter was built and owned by
Kaiser Aluminium Corporation, which had similar plants in
Kitimat and Fresno in Canada, and other plants in Jamaica
and Guyana. Aluminium smelting is said to require enormous
amounts of power, hence the construction of the Akosombo Dam
whose finance was caught up in the Cold War geopolitics of
the 60s. All the same, Nkrumah managed to pull it off with
loans from the USA, the multilateral institutions, and other
private financiers.
Aluminium is said to be one of the hardest, strongest,
malleable, versatile, and lightest metals in the world, and
in great demand for aircraft manufacture, window and door
frames and panels, cooking utensils, roofing sheets, among
other construction and industrial uses. Aluminium is also
used for high tension electricity pylons, telecommunication
towers, among other uses. Its atomic number is 13. It has
indeed wide applications. I once gave private tuition to the
children of some Indians who worked for Tower Aluminium
Company in Nigeria. They had worked in Tower Aluminium
Company branches in Kenya and Tanzania before being
transferred to Nigeria. That was in the early 80s.
When in the 70s, the Japanese wanted to mine and utilize the
bauxite deposits at Kibi in the Eastern Region; they had to
abandon the project because VALCO increased their own power
usage, and denied them access to extra power from Akosombo.
Such was the power and clout of the Kaiser MNC. However, the
initial agreement done by Nkrumah for the funding of the
project precluded any third party from having access to
extra power from Akosombo. JJ Rawlings, during his
revolutionary years, managed to successfully renegotiate the
agreement to the benefit of Ghana, after a long, gruelling,
and protracted negotiation process. I remember Tsatsu
Tsikata and Kwesi Botchway played prominent roles in that
process.
The largest consumers of power in Ghana are the mines, VALCO,
manufacturing companies, commercial households, and
residential places. The installed capacity of power
production in Ghana, according to the Ministry of Energy and
Petroleum, is 2100 MW of which fossil fuel contributes 25%,
Solar and Wind powers contribute 1% (Blue Energy), and
Hydro-Electricity contributes 74%. Energy output is from
both public and private generators, with the private sector
generating 53% of the total output.
Experts surmise that Ghana currently requires an installed
capacity of between 4000MW to 5000MW to meet its future
growth potential. This is a tall order but with systematic
planning, it is not an impossible target to attain. This is
the time now to woo and attract outside investors,
especially from the oil-rich Middle East countries to come
and invest in our energy sector. Before that, we should
ensure that we have a good country profile in terms of
political stability, good governance, and transparency,
prudent fiscal and monetary management, among others.
The danger now is that with global warming on the
ascendancy, and with rainfall patterns becoming erratic and
unreliable, as a result of deforestation and disturbance in
the hydrological cycle, dependence on HEP is risky. Thus
hydro-power is under threat. Besides, countries upstream may
also build dams and disturb the flow of water downstream, as
is happening between Sudan, Ethiopia, and Egypt over the
Blue and White Niles.
The energy consumption per capita in Ghana is currently 298
Kwh. This is likely to zoom up with the growing number of
educated people and mass exodus of young school leavers into
the urban areas. Also having reached lower middle income
status with a rapid increase in the middle class, our energy
demand assumes a sophisticated stance; hence demand for more
home gadgets and appliances.
The current load-shedding or Dumsor phenomenon should be a
thing of the past, should all the additional power
generation stations come on stream, especially the gas from
our own Twenebowa oil field, and the supplement gas from
Nigeria through the erratic West African Gas Pipeline (WAGP),
and the supplement from the Aboadze Thermal Plant. With the
Bui Dam completed, our power supply should stabilize in a
year or two from now. What we need currently is efficiency
and sanity in the management of our energy sector. We need
to bring in experts from reputable energy companies such as
ABB, Eskom, Siemens, among others to give us a second
opinion on rationalization of the energy sector in Ghana,
which is currently in a very chaotic situation.
There is too much politicisation, amidst the crave to put
square pegs in round holes by the authorities, which is most
unfortunate. President Mahama should sit up and get his act
right, because it is the long run survival and wellbeing of
Ghanaians which is at stake. It will be shameful for foreign
investors to turn their investments away from our shores
because of unreliable power supply.
A few years ago, our Foreign Direct Investment was
increasing by the day, hence more demand for power. The GDP
was growing at 14% against the current pitiable rate of 5%.
Some people strongly believe that the frequent power outages
in Ghana is politically- orchestrated and even though there
could be some iota of truth in that, it could also be said
that the massive inflows of FDIs have over-stretched our
energy resources beyond our installed capacity, and we were
caught off guard. I believe there is some truth in both
speculations, apart from the glaring fact that supply has
lagged far behind demand, leading to a critical power
deficit. Many observers are at their wits end to know that
we have Akosombo, Kpong, and Bui Dams in Ghana, yet we talk
of power deficit. It is like living along the banks of the
Great Volta or Fraw River, yet you have your bath with dust
or ashes. What a paradox!
Domestic or residential consumers in Ghana take up 50% of
the supply of electricity, industries gulp up 37.5%, and
commercial users take up the balance of 12.5%. In 2007, the
power deficit led to 1% reduction in GDP, which was quite
serious indeed. That meant that productivity declined,
exports suffered, and also employment was affected. The
Akosombo Dam has six turbines with each producing 167 MW, a
total of 1,042 MW. Ghana exports power to neighbouring
countries of Benin, Togo, and Burkina Faso, a measure
ostensibly to generate foreign exchange, and also to bring
about good neighbourliness.
When it comes to regulatory and power generation authorities
and oversight in Ghana, I am completely nonplussed and
confused because there are a plethora of them. We have
Electricity Company of Ghana (ECG), Volta River Authority (VRA),
Public Utility Regulation Commission (PURC), Takoradi
Thermal Power Plant (TAPCO), Northern Electricity Department
(NED), Tema Oil Refinery (TOR), Ghana National Petroleum
Company (GNPC), Ghana Grid Company (GRIDCO), Ghana Energy
Commission (GEC), National Environment Commission (NEC),
GEPA, Nzema Photo Voltaic Project, among many others.
There are clear signs of duplication, waste of resources,
and a recipe for chaos. The national access to electricity
is 60%, while access in northern Ghana is 30%. The growth in
annual demand for power is estimated at 10%. There is
therefore the need to accelerate the Rural Electrification
Programme, to extend power to every nook and cranny of Ghana
for rapid development, especially to the northern parts of
Ghana. It is very shameful indeed that more than 50 years
after independence, some parts of Ghana live in the dark
without access to the national grid. Imagine a scenario of
having a bleak Christmas without water or electricity
supply, especially when you have some relatives visiting
from abroad? What a national embarrassment!
Some of the problems assailing the energy sector in Ghana
are due to corruption, incompetence, and logistical
constraints. They include dealing with old and obsolescent
equipment, overloading of transformers, illegal electrical
connections, insider-trading by some managers to create
business for generator set suppliers, system losses, among
others. We may sometime in the near future have to look in
the direction of nuclear energy supply, by closely
monitoring and following the research findings made so far
at the Kwabenya Nuclear Reactor.
Even though the risks are high, nuclear energy is another
alternative source of energy which is however considered
unsafe and environmentally hazardous. In such matters,
government has to seek advice from our scientists and
technologists such as Prof Francis Kofi Ampenyin Allotey and
others, or better still, GAAS (Ghana Academy of Arts and
Sciences). In Britain, the Royal Society and the Science
Council drive science and technology-related policies.
The following could be some of the negative effects of power
deficit in Ghana:
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Brain drain
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Reduction in tourism and loss of foreign exchange
earnings
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Reduction in national output and productivity
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Lowering of the quality of life and standard of living
in Ghana
Loss of lives of people in hospitals on life support
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Loss of other services which rely on power supply such
as water supply
Increase in crime when power outages occur
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Increase in inflation and the cost of doing business in
Ghana
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Increase in pollution and insanitary conditions when
water is not running
Reduction in FDI flows
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Increase in stress and frustration which can spark
demonstrations
Loss of business and lowering of profits
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Unpopularity of the government and the power utilities
Recommendations
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Streamline the number of authorities in charge of power
regulation in Ghana as there is too much duplication.
Some of them should be scrapped or shut down or merged
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Come up with a medium to long term plan of reform,
restructuring, and rationalisation
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Decentralise power supply and encourage the construction
of power stations on rivers such as Pra, Tano, Ankobra,
Black Volta, Oti, Kulpawn, among others
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Increase the current public generation of electricity
from 47% to say 60% because power generation is
strategic and should not be dominated by the private
sector
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Decrease annual private investment from 60% to say 40%
because this is a strategic resource which foreigners
should not be allowed to control
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Phase out old equipment and replace with more modern and
efficient ones Encourage exploration into using
alternate, appropriate and sustainable energy sources
such as geothermal, tidal, solar, biogas, biomass,
Ethanol, among others.
Kwesi Atta Sekyi
kwesiattasakyi449@gmail.com
References
https: //energypedia.info/wiki/Ghana_Energy_Situation
www. energymin.gov.gh/?page_id=78
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