Drop in tariff is due to renegotiated Karpower deal – Business

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The Energy ministry has disclosed that the renegotiation of the Karpower deal has led to the recent drop in electricity tariff which was announced by the Public Utilities Regulatory Commission (PURC).

In an interview with Accra-based Starr FM, the communications consultant to the ministry, Nana Damoah, said the initial arrangement reached by the Mahama government with Karpower did not give value for money.

“I mentioned that we had renegotiated some deals to ensure they are very good and Karpower is not an exception. It’s either we accepted the high tariffs and moved on or we would have to deal with it. We would be able to save $54M annually for the people of this country. I think people should think about this in their own perspective and not in the eyes of the NDC. Think about how this affects the tariff we pay. We believe that this arrangement directly affects the tariff you pay and that is why the tariff has gone down.”

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The Akufo-Addo-led government has extended the much debated Karpower deal from ten to twenty years.

They argued that the deal has been renegotiated to ensure that there is value for money.

The deal with the independent power producer which was contracted by the erstwhile Mahama administration to address the country’s power challenges at the time was originally for 10 years.

After the President Akufo-Addo was sworn into office, the African Center for Energy Policy (ACEP), called on the government to renegotiate the deal.

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After the news of renegotiating the deal, a former deputy Power Minister and a member of the Energy committee of Parliament John Jinapor said the sector minister will be made to answer for his decision.

“I’m surprised that this government can make such a U-turn after criticizing the Karpower deal, after lambasting it they have not admitted that we need the Karpower deal but gone ahead to extend it by those number of years.”

“It is most unfortunate [and] it tells you that they were not sincere, they were not honest and were not engaged in nothing but partisan politics,” he added.

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