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VRA spends $2.5m a day on power generation
From: Ghana/Myjoyonline.com/Jerry Tsatro Mordy          Published On: December 19, 2012, 10:00 GMT
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VRA spends $2.5m a day on power generation

Sam Kwesi Fletcher

The Volta River Authority (VRA) has revealed that it currently spends no less than $2 million per day to generate power to meet the national demand.

The Authority also incurs a cost of $50 million for the purchase of Light Crude Oil (LCO) to produce power that can last the nation as few as 20 days as a result of the unavailability of natural gas.

These facts were disclosed by VRA Head of Corporate Communications Sam Kwesi Fletcher on Joy FM's Super Morning Show Wednesday, December 19, 2012.

The VRA produces 60% of the country’s power supply through energy generated by the Akosombo and Kpong hydroelectric dams while the remaining 40% is generated through its thermal plants and other independent power producers. It generates and supplies power to the Ghana Grid Company (GRIDco), which also transmits to the Electricity Company of Ghana (ECG) for distribution to individual consumers.

According Mr. Fletcher, the VRA previously spent $50 million on the purchase of 400,000 barrels of LCO to complement gas to generate power which could last the nation 90 days (three months), but the lack of supply of gas has created a situation in which the same amount can generate enough power for only 20 days.

Mr. Fletcher noted that the other option, which is to rely on diesel to produce power, is also expensive. He said under the prevailing circumstances, between $2 million - $2.5 million is spent to generate electricity power each day.

He described the present situation as “not sustainable”, adding that the “best way is to run on gas, which is 50% cheaper.”

He reported that work is underway to add about 1,100 mega watts of power to the national grid in the next three years. The VRA expects an 11% growth in demand but a lower growth in demand according to him, will give the country more power in its reserve system.

He stressed on the need to minimise losses in transmitting power as well as those incurred when consumers connect illegally.

Commenting on whether or not existing tariffs paid by consumers are realistic, Mr. Fletcher said “the tariff regime is not attractive to foreign investors”, since the utility providers do not have control over how much consumers pay.

He said the circumstances could only force the utility producers to operate on the cheapest source, which is gas, but they risk going out of business when it becomes unavailable.

He announced the need to find a better way of reviewing tariffs that involves producers, whereas presently the Public Utilities Regulatory Commission (PURC) determines the price to be charged without input from the producers.

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