Energy analyst, Dr. Yusif Sulemana, has labeled the Millennium Challenge Corporation’s (MCC) decision to retract the $190 million compact as “a double whammy.”
Speaking on TV3’s News Central, Dr. Sulemana emphasized that the withdrawal stemmed from insufficient capital and systemic inefficiencies within the electricity distribution chain.
He pointed out that despite challenges, the involvement of Independent Power Producers (IPPs) in power generation has injected vitality into the sector.
“We haven’t done the right thing and if you haven’t done the right thing and you expect something magical to happen, nothing will happen. I see that as a double whammy. This is a time that if you look at what is happening at the moment, is all because of what we couldn’t do in the distribution arm of it. First, we don’t have the capital that is is required and the inherent inefficiency in the system and that’s culminating in what we have today,” he explained.
“When we have efficient private sector participation in energy sector, two things will happen: number one, they will inject the required capital that is needed to rejuvenate the system. To make the system resilient. Number two, private sector participation will minimize political interference in sector,” he explained.
Dr. Sulemana advocated for enhanced private sector participation in distribution to improve efficiency and reduce political interference.
He stressed the importance of selecting partners focused on business benefits rather than parasitic investment.
Regarding the lost funds, Dr. Sulemana highlighted the need for investments in the current system, particularly in metering infrastructure, to mitigate commercial losses faced by the Electricity Company of Ghana (ECG).
Meanwhile, Ben Boakye, Executive Director of ACEP, attributed the loss to political manipulations under the Millennium Development Authority (MiDA).
John Dramani Mahama, flagbearer of the NDC, pledged to investigate the PDS scandal if elected, blaming corrupt governance practices for the loss.
Background: The PDS concession, part of Millennium Challenge Compact II, was suspended in 2019 due to breaches, leading ECG to regain control of power distribution.