Ghana’s private power companies are threatening to walk away from talks to repay $1.6 billion in arrears, potentially derailing the West African country’s long-running debt restructuring efforts.
Ericpreem Apetrugbor, chief executive officer of the Ghana Independent Power Generation Company, said the government was not living up to its commitments on payments, even as some generating companies agreed to cut back payments and others agreed to reduce energy tariffs.
Independent power producers “we expected that half the outstanding payments would have been paid by now and that payment plans for the rest would be in place,” Apetrgbolu said in an interview. “We may be forced to reevaluate our concessions and ask for full payment of the arrears.” The government had paid about $400 million by the end of December, Apetrgbolu said.
The contracts with the IPPs included the state-owned power utility, the Ghana Electricity Company, ensuring that payments to the IPPs remain current beyond June 2023. But the company has only paid 70% of its monthly bills and has reduced that to 21% in the past three months, Apetrugbolu said.
A Treasury Department spokesman did not immediately respond to a request for comment.
Ghana has been negotiating with the IPPs since last year to repay the arrears as part of its foreign debt restructuring.
The country has restructured almost all of its $45 billion in debt to make it sustainable under an International Monetary Fund program, and the dispute could affect that rating.
Ghana secured an IMF bailout in 2023 after its debt ballooned and it defaulted on eurobond repayments. Ghana completed a domestic debt restructuring last year and hopes to soon complete negotiations to restructure a $5.4 billion bilateral loan and $13 billion eurobond.
The nine-member IPGG produces more than 60 percent of Ghana’s peak demand of 3,618 megawatts and 80 percent of its thermal electricity generation.
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