Building Ghana’s energy infrastructure

Building Ghana's energy infrastructure

Building Ghana's energy infrastructure

Ghana boasts of a booming Energy sector that forms the backbone of its economic development. Realising the potential, the nation’s first hydroelectric dam, known as Akosombo was built in 1965.

Over time due to increased demand, other sources of energy such as thermal, wind and solar have also been added to Ghana’s mix of energy offerings. This development including the Government’s supportive energy policy, have paved the way for Ghana to emerge as a major energy exporter.

Ghana’s energy sector is made up of two sub segments - Power and Petroleum. The Petroleum sector is further divided into a) downstream activities - distribution and production of finished products b) upstream activities - exploration, development and production of oil & gas.

The tema oil refinery

The Tema Oil Refinery operates in Ghana’s downstream activities segment and operates the country’s sole petroleum refinery which processes roughly 45 000 barrels of crude oil every day.

It was built in 1963 and is located 20 kilometres from Accra, the nation’s capital.

This refinery produces:

  • Diesel
  • Kerosene
  • Gasoline
  • Liquefied petroleum gas
  • Pre-mix fuel
  • Aviation fuel

Important energy ministries and commissions

For investors interested in Ghana’s Energy sector, here are the country’s most important bodies that offer permits, licenses and other business related documents:

The Ghana Petroleum Corporation (GNPC). Operational permit is given within the country’s territorial jurisdiction.

  • The Ministry of Energy and energy sector in Ghana. This is where licensing, supply, distribution, sale and compliance with standards and requirements are undertaken.
  • The Public Utilities Regulatory Commission (PURC). This commission safeguards consumer’s and provider’s interests, approves rates, monitors performance and adherence of set standards and promotes competition between service providers.

Ghana’s top power providers

Ghana’s energy sector currently comprises of the following plants and power related operations:

Akosombo Dam – A hydroelectric power plant. Three utilities presently run the Power sub-sector of Ghana: the Ghana Grid Company Limited, the Volta River Authority (VRA) and the Electricity Company of Ghana Limited (ECG).

As of 2011, these three utilities were able to generate a total capacity of 2 169.50 megawatts of electric power. The latest addition was the CENIT Power Plant that became operational last October 2012 adding another 126 MW to the current installed capacity.

Additional energy production generating sources as of 2015

The following are the latest additions to Ghana’s list of energy plants:

  • Osagyefo Barge - 125 MW
  • Kpone Thermal Power Plant construction and recommencement-  220 MW
  • Bui Dam (hydroelectric dam) - 400 MW
  • T2 Thermal Plant Expansion- 110 MW
  • Cenpower Generation Company Ltd - 340 MW

Based on country data, Ghana’s energy market  is a dynamic one that holds positive potential for foreign investors.  Deregulation introduced in the 1990s has encouraged the birth of Independent Power Producers (IPPs), and decentralisation of the distribution market resulting in a competitive market place.

Yet, Ghana has been experiencing major electricity shortage and this has slowed down its progress path. Steps to improve the situation will involve cutting subsidies, decrease in the public sector wage bill, increasing revenue and building revenue administration. Hence, changes on the electricity front are bound to take time.

 

This entry was posted in Africa & ME on April 12, 2016 by specialist.