The Government of Ghana has achieved a significant milestone in its energy sector reform efforts by successfully restructuring $1 billion in legacy debt owed to Independent Power Producers (IPPs). Finance Minister Mohammed Amin Adam made the announcement during a joint press conference with the Bank of Ghana (BoG) and the International Monetary Fund (IMF) on July 1, 2024.
The negotiations, which spanned several months, focused on restructuring Power Purchase Agreements (PPAs) and clearing arrears accumulated over years of financial strain in the energy sector. The agreements with IPPs like AKSA, Amandi, CENIT, Cenpower, Karpowership, Early Power, and Sunon Asogli will alleviate financial pressures and enhance operational efficiencies.
The restructuring of PPAs will ensure IPPs receive timely payments and continue to contribute to Ghana’s energy needs without interruptions. Key components of the agreement include revised payment terms and adjustments to contractual obligations.
Some agreements, such as those with Amandi, Cenpower, and Early Power, will require parliamentary approval to finalize amended terms. The restructuring efforts are part of Ghana’s broader Energy Sector Recovery Programme (ESRP), designed to address systemic challenges and enhance sectoral resilience.
The Minister expressed confidence in the transformative impact of these reforms on Ghana’s economic stability and growth trajectory.
The restructuring deal with IPPs is expected to significantly boost investor confidence and provide a solid foundation for Ghana’s economic recovery, setting the stage for sustained growth and development in the coming years.
