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Power Supply in Ghana ECG concession won't result in high electricity tariffs - MiDA

In a press statement Tuesday, MiDA said: “It is also not the case, as alleged in the press statement of PUWU that high tariff will result from the concession agreement.

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The Millennium Development Authority says it is not true that the privitisation of the Electricity Company of Ghana (ECG) will result in high electricity tariffs.

In a press statement Tuesday, MiDA said: “It is also not the case, as alleged in the press statement of PUWU that high tariff will result from the concession agreement. On the contrary, improved performance and reduction in the current loses of ECG should facilitate progressive lowering of tariff."

The press statement follows protest from the Public Utility Workers Union (PUWU) over the decision of government lease ECG to a private company for 25 years as part of the second compact of the Millennium Challenge Account signed by the Government in August 2014.

The statement noted that the concession agreement available for ECG was done with integrity, transparency and in good faith as all stakeholders were consulted.

PUWU has warned of high electricity tariffs should the government privatise ECG.

Deputy General Secretary of PUWU, Michael Nyantakyi, said the recent hikes in energy bills was designed toward making ECG attractive for the private investor.

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At a conference last week, he further warned that the concession is not the best option to bring reforms to make ECG more efficient and profitable.

He said: "This policy is not the best option to bring reforms to make ECG more efficient and profitable. We have already articulated our views and suggestions in our position paper to MiDA and the ministry of power.

However, MiDA, in its press statement said the concession move will strengthen the balance sheet of ECG and make it productive.

“The ECG financial and operational turnarounds project also recognises the need for significant investment in the power distribution infrastructure and the operational systems of the ECG. It is in response to that need that over US$350 MILLION OUT OF THE US$ 498.2 million for the compact program has been allocated to the ECG”.

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