Govt has cleared debt - ECG confirms

The Electricity Company of Ghana (ECG) has confirmed that the government has cleared its indebtedness to the company.

Beyond that the government now has in excess of GH¢500 million in outstanding credit with the company.

A statement signed by the Managing Director of the company, Mr Kwame Agyeman-Budu, said as of the end of 2016, total government indebtedness to the company netting off all government payment was GH¢2.63 billion.

The statement seems to bring clarity to a dispute between the government and elements within the opposition National Democratic Congress following a disclosure to this effect by the Energy Minister, John-Peter Amewu, last Monday.

It explained that the government averagely paid GH¢2 billion directly to its suppliers — which were Volta River Authority (VRA), Independent Power Producers (IPPs) and Ghana Grid Company Limited (GRIDCo) — to defray government’s indebtedness to the company.

Account

It added that by 2019, the total government account had a credit balance of GH¢505.8 million, indicating that the amount was enough to settle government’s bills for January to April this year, considering the government’s average bill of GH¢100 million a month.

“It is also important to add that the government has also paid an amount of GH¢4.14 billion directly to various fuel suppliers and power producers, and is yet to be credited to the government’s account under the ongoing reconciliation exercise.

Therefore, when the exercise is completed, the amount certified will be a further credit to the government’s account,” the statement said.

“We wish to reiterate that the payments made by the government were not deposited into ECG's account. Rather, government's direct payments to our suppliers has cleared our books of government's indebtedness after a successful reconciliation with our suppliers,” it added.

Background

Mr Amewu, last Monday announced that the government had settled all of its indebtedness to ECG, including the GH¢2.63 billion it inherited on assumption of office.

He added that the government had made efforts to be current with payment of bills to the ECG, culminating in the payment of GH¢2 billion every year with an average monthly payment of GH¢100 million.

In addition, the minister said the government had also made some payment to the ECG under the COVID-19 power subsidy policy which has taken off.