World Bank mobilizes $60m financing for electricity in Ghana

The World Bank Group says its Board of Executive Directors has approved a $60 million credit for the Electricity Company of Ghana (ECG).

In a press release issued in Washington DC and copied to ghanabusinessnews.com today May 1, 2015, the Bank says the International Development Association (IDA) credit for Ghana is to improve the ECG’s financial performance, minimize its commercial losses, and ultimately contribute to increased revenue and cash flow.

According to the Bank, the credit provides additional financing to the Ghana Energy Development and Access Project (GEDAP) originally approved by the Bank Group’s Board on July 26, 2007, including $90 million and an additional $70 million approved on June 3, 2010.

The Bank states that the GEDAP funds have broadly supported (i) Sector and Institutional Development; (ii) Electricity Distribution Improvement; (iii) Electricity Access and Renewable Energy; (iv) Expanded Capacity for Electricity Distribution Improvement; (v) Revenue Collection Improvement; and (vi) Management and Planning Enhancement.

Most of this new financing will be used to increase the scope and impact of ongoing activities to strengthen ECG’s billing and metering systems to improve its operational efficiency. As the agency responsible for managing the energy consumer accounts, ECG’s performance has a major impact on the entire energy value chain, the statement says.

The Bank believes that improving ECG’s performance could help create better conditions for attracting private financing to generate desperately needed new power. This shortage of power is also curtailing economic growth and adversely affecting the profitability and sustainability of businesses, as Ghana is currently experiencing a significant shortage of electricity.

By Emmanuel K. Dogbevi