Sunon Asogli shutdown sparks 'dumsor' fears amid $259m debt dispute

October 27, 2024 - Ghana's Finance Minister, Dr. Mohammed Amin Adam, has condemned the management of Sunon Asogli Power Plant Limited for shutting down its 560-megawatt power facility due to the Electricity Company of Ghana's (ECG) unpaid debt of $259 million.

The shutdown has sparked concerns about a potential return to intermittent power outages, known as "dumsor," which could have severe economic impacts on the country ¹.

Speaking at the Annual IMF-World Bank Meetings in Washington, D.C., Dr. Amin Adam assured the public that a resolution is underway. He revealed that an agreement to settle the debt is expected to be signed within days, preventing further disruptions to Ghana's power supply.

According to Dr. Amin Adam, the Ministry of Finance had agreed to pay Asogli $30 million as part of the settlement, but the company suddenly demanded $60 million, threatening to shut down if the amount wasn't paid.

Dr. Amin Adam viewed this as an act of bad faith, particularly with elections approaching.

“Asogli submitted the final agreement for our review. We reviewed it and are fine with it except for one issue which led to the shutdown. So when the Ministry of Finance made the one-off payment to all the IPPs, we were supposed to pay Asogli $30 million and subsequently, they made a case for another $30 million but we did not agree to that so we finalise the negotiations with them on the arrears.

“ECG actually led the negotiations and as part of the settlement, ECG wanted us to pay the $30 million. ECG made a case for which we didn’t agree so I had meetings with Asogli and we agreed that we would pay but we wanted them to sign the settlement agreement because this is one of the terms of the agreement and they said no, we should pay before they sign but if it is part of the settlement agreement why should I implement an agreement that has not been signed.

“So we communicated this to ourselves only for Asogli to come to say they no longer wanted $30 million but they wanted $60 million dollars and that if we don’t pay them they will shut down.”

“So it will be as if we as a country, we don’t know our rights especially when an election is closer everybody thinks that when I put a gun on the head of government by going ahead to shut down, they acted in bad faith.”

Source: Lead News Online