THE HOLISTIC APPROACH TO ENDING DUMSOR

electricity is always at the heart of economic transformation

OVERVIEW

In 1961-1965, a landmark dam, the Akosombo dam was constructed. The Akosombo hydroelectric project was a brainchild of Dr. Kwame Nkrumah, and it served about six million Ghanaians then. One would have thought this development was a precursor of greater achievements for erstwhile Gold Coast. Rather unfortunately, today, the Akosombo dam and electrical energy in general have become a headache for the nation. ‘’Dumsor dumsor’’ it is.

It is estimated Ghana currently has a power deficit of 550MW (megawatts) including 200MW for reserve. It is pathetic instead of stakeholders working fervently to ensure energy security in the nation, all the glamour is about political talks. It will be a grave injustice to blame a particular political leader/party for the dumsor mess we find ourselves in. Each and every head of state who once served after Dr. Nkrumah’s regime should be congratulated for our energy crisis- well at least that is what they expect us to do.

It cannot take a single blog post to consume up our entire energy sector but this post may just prove otherwise.

Akosombo dam has been the pulse of Ghana's electrical energy

THE CHALLENGES

It is becoming evident no crisis in my country can be divorced from poor leadership. Absolute lack of foresight is the virus for our current predicament in the energy sector. Imagine if all the eleven heads of states who served after Dr. Nkrumah at a point in time had decided to construct another 1038MW dam or better still look to other avenues of power. Even though ex-president J.A Kuffour did attempt a power to add up to the power generating capacity through the construction of the Bui dam, this project was just another political gimmick and it may take forever for the Bui dam to be fully operational. In addition, financial incapacity has cost us a lot in the power sector. We lack the financial muscles to improve on our power generation and this is by no fault of Nature’s. We have failed miserably at generating income from our power sector. Just about two weeks ago, we have been made aware of GHC500m debt owed the Electricity Company of Ghana (ECG). Last year at the public accounts committee, revelations on ECG’s annual turnover in 2013 was at best comical. One may be tempted to think inadequate indigenous scientific knowledge may be one of the challenges battling our energy sector. For instance, a friend quizzed me on why our professors could not lead a team of students to work on a power plant. Then again, you go back to my two previous points; poor leadership and lack of funds. Stories of low water levels on annual bases in the Akosombo dam may as well legitimise this claim of inadequate scientific capacity, but l do not agree. Test the Ghanaian professor and his students through the provision of all apparatus, and you see the results for yourself.

leadership wahala, the vision of Osagyefo still missen

ABOUNDING HOME PROSPECTS

Even in all the management blues, Ghana still maintains a great potential to be an energy power house in Africa. The resources for all forms of electrical power generation are everlasting in the nation. The tidal waves, lakes, rivers, sun, biomass, winds, and thermal prospects are all encouraging. Luckily for us, there are text book approaches on the utilisation of all these available natural resources in the form of electrical energy. More intriguing is that all the potential power sources are limitless and unquantifiable. In addition, the controversial nuclear plant is also an avenue for power generation. Let us leave the politics out of the discourse surrounding the building of a nuclear plant in the country and allow science to take charge. Nothing could be impossible, more so when the blueprint is in other countries. The uranium deposits could finish in the next future but l believe can go beyond the realms of uranium. Why can we not pioneer with a new form of atomic electrical power generation even if it will take us the discovery of ‘’ghananium’’ to do so? Electrical energy potentials are all over the nation and that which is needed is the ever elusive harnessing.

tidal waves at Ada beach; a potential of power hub

THE SHORT TERM MAGIC BULLET

The crises are confronting our power sector, and all we should focus now on is finding a solution or risk dumsor make energy sector powerless. I have monitored His Excellency attempt to solve the problem in the interim, most recent of which took him on the plane to Berlin, and the formation of a power ministry. I do not see any hindrance to the Ministry of Energy that it could not roll out measures to arrest the menace of dumsor, and l do not believe it takes an establishment of a new ministry to provide energy security for a nation either. Well, young Barack Obama told our parliament and the nation at large in his address-way back in 2009 when he paid a visit-to pay important attention to make investments in the power sector. It therefore amazes me that the ‘’yevoo’’ opened our eyes, we chose to close our eyes and fly blindly to the white to bail our power sector out.

I have thought of a short term plan to generate 800MW of power in a matter of six months. 800MW is more than enough to end dumsor and also provides a surplus of 250MW, which could be sold out. My break down includes; 160MW solar project to be situated in the North, 480MW biomass project to be situated in the South, and 160MW wind energy project to be situated at the Central portion of the nation. 

I am aware of the fact that in economic terms, one would suggest we focus on just  biomass because it is the cheapest form among the three forms l have enlisted above, but l think the other two forms- solar and wind- are vital in the future and paying attention to them now is a watershed investment. In scientific tools, management, capacity building, etc, an investment in wind and solar now shall pay us back in the shortest possible future. Also, it is only expensive to install solar cells, afterwards it is all about reaping the fruits.

concentrating solar power in Spain, a blueprint

FUNDING

A 480MW biomass project will cost us $125m, a 160MW solar project will cost $460m, and a 160MW wind project will cost $240m. All these dollars sum up to 795m. It is an open secret the Volta River Authority lacks the financial strength to carry out such a project.

In somewhat a deviating sentence, l would like to express my displeasure at efforts give up huge stakes in our energy sector to the private sector to private firms; these private firms have nothing to offer Ghanaians, all these private firms seek is the maximisation of profit. We cannot keep burdening the Ghanaian with unreasonable tariffs due to investments by private firms.

In my capital tree to raise $795m, l have uncovered an indigenous way to come up with the funds;

Ø $267.5m syndicate loan from banks operating in the country at the rate of accumulated 130% in period 30 months.

Ø $100m investment from the VRA/Government of Ghana.

Ø $70m investment from Ghanaians in the diaspora under the supervision of Ghana’s embassies with mandate from Bank of Ghana by the sales of treasuries at 100% with a maturation period of 30 months

Ø $357.5m investment from Ghanaians at home through the sales of treasuries at 100% with a maturation period of 30 months;

1.     An investment of $100,000 each from 500 citizens

2.     An investment of $50,000 each from 1000 citizens

3.     An investment of $20,000 each from 4000 citizens

4.     An investment of $10,000 each from 5000 citizens

5.     An investment of $5,000 each from 15000 citizens

6.     An investment of $1,000 each from 30000 citizens

7.     An investment of $500 each from 30000 citizens

8.     An investment of $100 each from 40000 citizens

9.     An investment of $50 each from 70000 citizens

Due to the poor revenue generated by the VRA and ECG over the years, investors may be reluctant to trust their investments in the hands of VRA. Nonetheless, if proper logistics are put in place, investments shall flow in. It is obvious that the energy industry particularly in Africa is lucrative venture. It just takes a little bit of awareness creation to get indigenous Ghanaians to invest in the power sector of their nation-everyone wants to say goodbye to dumsor. The heavy profit margins- though they may look ridiculous at first sight- is a ruse aimed at encouraging investing at a fast pace. Besides, 800MW of electrical power at the current tariff rate rakes in well over GHC9.5bn in 30 months, so there is enough to give out. 

I do not want to bore you with the breakdown of the finances (you may forward any concerns over the finances to me at kizito8@gmail.com and l shall address all those l can). At the end of the investment cycle, the VRA should have well over GHC4bn to invest independently in other electric projects.  

THE BIGGER PICTURE

Africa in general has her fair share of the power crisis. It is good news for any investor who is keen on investing in the energy sector of Africa. Power generation and distribution in Ghana should never be limited to the borders of Ghana alone. The West Africa power crisis is a scholarship for our power sector to build and underline its pedigree. 

‘’ECG’’ can tap into this market by building under water cable through the gulfs. Mozambique, Gambia, Ethiopia, Sudan and Congo would not prevent Ghana from providing them with reliable power through the harnessing of their hydroelectric potentials. Furthermore, the principles of solar, thermal, wind etc holds elsewhere on the continent. It has been estimated Africa needs to invest $480bn to put an end to the erratic power supply system on the continent, and if you invest $480bn in electricity over period of three decades, you make hundred$ of trillion$.

    

VRA, still an awful lot of work to be done

To carry out the vision of this post, we must not rely on only Volta River Authority. Talks of nuclear, solar, and biomass means other forces must come to the fore. Parliament, it is now your turn.