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Renegotiate Ameri deal to save $ 24m annually- IMANI

Policy think tank IMANI Ghana has disclosed that renegotiating the Ameri deal will save the country 2 million dollars monthly, translating into 24 million dollars a year.

According to the group, it is imperative for government to renegotiate the agreement to maintain value for money.

Speaking on Citi FM’s Breakfast Show today [12/4/2017], an Honorary Vice President of IMANI Ghana, Bright Simons argued that some West African countries procured a similar plant at a far lower cost.

“Burkina Faso and Benin have actually rented APR machines directly from APR. They did not go through all of these processes we took and we know the per kilowatt power per cost that they were charged. When I did the computation for Burkina Faso it was around 360,000 dollars per megawatt. Ghana’s figure is 2 million dollars per megawatt [monthly] and even more”, he said.

The Philip Addison Committee set up to investigate the Ameri contract signed under the erstwhile John Mahama administration recommended that the deal be renegotiated or abrogated on grounds of fraud.

The committee stated that Ameri in its agreement with government charged Ghana significantly higher than what it was charged by the Turkish registered company – PPR, which financed and executed the project.

The Turkish firm pegged the total cost of the project which is to span over a 5 year period at a maximum of 360 million dollars.

However in the Build Operate Own Transfer (BOOT) agreement signed between  government and Ameri, the deal was pegged at a minimum of 510 million dollars.

This gave Ameri a commission of 150 million dollars.

Commenting on the issues, Mr. Simons was of the view that the deal is rip-off, and puts government in disadvantaged position, hence the cost must be reduced.

“We have to consider the other variable cost. We buy fuel and others. Burkina Faso paid significantly less for the same plant and also went directly to APR. We, on the other hand, had to go through Ameri, through Metcat, through PPL and finally got an EPL plant. That’s one layer of bureaucracy and cost,” he lashed out.

Mr. Simons chastised the representatives of government who endorsed the agreement, pointing out that Ghana was buying the power in excess of the original cost.

“Basically the agreement that we signed is just a modified version of what APR uses in other places. That agreement indicates that the cost of power is nearly 15cents. I don’t see how you can say power is cheap when you are buying it at almost twice what typically you buy from other plants in the country at the composite level,” he argued.

“Of course, some plants are expensive because there are specific circumstances but on the whole, you have to be guided by what is the composite tariff that your own regulator has issued as reasonable to charge for generation of power,” he added.

He further lamented about the huge cost of power imposed on consumers, calling on government to rectify the issue soon.

“In this country, how much do we even pay for power that we are importing from Ivory Coast is about 11 cents. It’s completely excessive. Considering the fact that we also have to pay for the fuel that power the plant, and the fact that in the agreement when the plant goes for scheduled maintenance, we continue to pay.” he said.

Source: http://citibusinessnews.com/index.php/2017/04/12/renegotiate-ameri-deal-to-save-24m-annually-imani/

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