Sunon Asogli Power Company Shuts Down Plants Over ECG's Indebtedness

• Sunon Asoli Power has shut down its plant due to the Electricity Company of Ghana's failure to settle a $259 million debt
• According to Sunon Asogli, the situation has left them in a tight financial state, making them unable to fund the operations
• The power producer has called on the Finance Ministry to intervene in the matter and to find a resolution as soon as possible

Independent power producer Sunon Asogli Power (Ghana) Limited has shut down its 560MW power plant due to the Electricity Company of Ghana’s (ECG) failure to settle overdue debt payments.

According to Sunon Asogli, the debt situation has left it unable to fund operations any further, hence the decision to shut down.

The company stated in a statement on October 16, 2024, that ECG owed it $259 million minus fuel as of September 30, 2024.

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Sunon Asogli said the huge debt was excluding the company's decision not to invoice ECG for idle capacity.

The company explained that its debt increased by 23% from January 2024 to September 2024.

It added that only 22.6% of the invoices for that period had been settled through the Cash Waterfall Mechanism, and the remainder had accumulated.

Sunon Asogli said it deeply regretted the shutdown and its likely impact on the national power supply but noted that the financial situation left it no choice.

The company also called on the Finance Ministry to intervene in the matter and facilitate a resolution that would allow it to resume operations as soon as possible.

The shutdown of Sunon Asogli's 560MW power plant has many Ghanaians convinced that load-shedding, also known as dumsor, will soon occur.

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In an interview with data analyst Isaac Kofi Agyei, he told YEN.com.gh that the last payment Sunon Asogli received from the government was in April 2024.

"The Finance Ministry has not paid their top-ups under the Cash Waterfall Mechanism since August 2024, and that's creating liquidity problems for ECG," he said.

He further explained that Ghana's biggest challenge is the abysmal performance of the cedi against the dollar, which has inflated the debt burden, making them unsustainable.

PURC warns about ECG's debt

YEN.com.gh also reported that the Public Utilities Regulatory Commission (PURC) has warned that the ECG could soon go bankrupt due to financial difficulties.

Dr Ishmael Ackah, the Executive Secretary of the PURC, sounded the alarm in a letter to the Presidency, the Energy and Finance Ministers, and key stakeholders.

He stated that the situation could have devastating effects on the operations of the Volta River Authority, the Ghana Grid Company, and the Bui Power Authority.

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Dr Ackah said the ECG already had challenges generating enough revenue to pay staff salaries on time and cover administrative costs and expressed deep concern.

Proofread by Bruce Douglas, senior copy editor at YEN.com.gh

Source: YEN.com.gh