Government refutes claims of usurping PURC mandate
| Updated Nov 17, 2017 at 7:15pm
Minister of Energy, Boakye Agyarko
The Minister of Energy, Boakye Agyarko, has debunked claims that government was trying to usurp the mandate of the Public Utilities Regulatory Commission (PURC), by announcing reduction in electricity tariffs in the 2018 budget statement.
According to him, government has not declared any reduction in electricity tariffs but rather has made a proposal to the PURC to seek their approval, adding, there was nothing wrong with the suggestion.
Mr Boakye Agyarko refuted the claim after appearing before Parliament to respond to questions filed by members of the House relating to the energy sector.
The Minister for Finance, Ken Ofori Atta, announced in the 2018 budget statement that the government had revised the tariff-setting procedure and the cost structure for power production.
He indicated that recommendations would be made to the PURC in this regard to bring a little more relief to businesses and domestic users of electricity and proposed an average reduction of between 13 and 21 percent in electricity tariffs for residential and industrial consumers.
Mr Agyarko also stated that section 3 of the PURC Act clearly spells out how tariffs are approved including; proposals from stakeholders for examination and review. He said all that the government had done was to send a request to PURC for their examination and approval. “if we as a government see benefits that could accrue and inure to the advantage of our citizens, it will be irresponsible on our part not to go to the PURC to approve these benefits so that our citizens can get cheaper electricity, I don’t think there is anything wrong with it” he said.
Mr Agyarko also announced that government had insured the FPSO Kwame Nkrumah against intermittent breakdowns and shutdowns for routine maintenance works.
He noted that hitherto, only the Jubilee Partners enjoyed insurance for interruptions in production stating that government had terminated 11 power purchase agreements at a cost of $400 million to the state since assuming power.
He said seven other power contracts had been deferred following recommendations of the Philip Addison-led review committee set up by the government.
He said despite the cost implications of the termination of the power deals, the state would eventually make savings of some $7 billion. “Pursuant to the review exercise, government will make significant savings from the deferred or terminated power purchase agreements. The estimated cost for termination is $439 million compared to the annual capacity cost of $586 million each year or a cumulative of$ 7.6 billion from 2018 to 2030. This yields an estimated savings of $7.217 billion US dollars over a 13-year period”.