Three companies owed the Ghana Grid Company Limited (GRIDCo), GH¢721.946 million as of December 31, 2016. The Electricity Company of Ghana (ECG) owed GH¢540.397million, the Volta Aluminium Company (VALCO) was in debt to the tune of GH¢117.889 million, while the Northern Electricity Distribution Company Limited (NEDCo) owed GH¢63.660 million.
The Board Chairman of GRIDCo, Mr Kabral Blay-Amihere, who made this known at the eighth annual general meeting of the company in Accra yesterday, said the indebtedness of the major customers, ECG and VALCO, were impacting extremely on the financial operations of the company.
Although GRIDCo’s financial performance in 2016 was good, earning GH¢673.835 million and making a net profit of GH¢69.132 million, Mr Blay-Amihere said most of the profit was in debt. The revenue showed an improvement over the 2015 period and net profit amounted to GH¢472.345 million and GH¢44.797million respectively.
In spite of the improvement in revenue, Mr Blay-Amihere said the finances of the company were hindering its financial capacity. “A comprehensive implementation of transmission projects and programmes which are important for the delivery of reliable electricity have been hindered by the company’s financial capacity,” the Board Chairman added. He, therefore, appealed to the government and other stakeholders to resolve the financial crisis facing the company.
“We believe the government will roll out all its plans to assist the power sector financially, particularly the minimisation of indebtedness of companies wholly owned by the government and the injection of capital to aid the achievement of the power sector objectives,” he added.
In his report, the Chief Executive Officer of GRIDCo, Mr Jonathan Amoako-Baah, indicated that the company’s improved financial performance in 2016, was mainly due to the increase in the power that was transmitted.
Nonetheless, he reiterated the huge impact the debts owed by its customers was making on the company and said, “management continues to pursue defaulting customers to recover huge outstanding service charge.”
He added that there was also an increase in transmission losses in 2016, due to the increase in power generation from thermal plants.
Touching on some achievements of the company in the year under review, Mr Amoako-Baah said GRIDCo’s efforts to commercialise part of its fibre optics to boost telecommunications in the country had also started, as the company had signed an Indefeasible Right of Use with MTN to host them on the GRIDCo fibre network.
A strategic business unit, he said, had also been established as a telecommunications unit of GRIDCo to oversee the activities of the telecommunication services. He stated that GRIDCo was for the second time, adjudged the Best Transmission Company in West Africa.
The Deputy Minister of Energy, responsible for Finance and Infrastructure, Mr Joseph Cudjoe, in his remarks, noted that GRIDCo was the backbone of power and every effort to prevent power crisis depended much on the company. He said the company, therefore, needed to be strengthened to drive industry, as it executed its mandate diligently. Mr Cudjoe said the government, for its part, was committed to ensuring efficient, safe and reliable generation, transmission and distribution of power.
According to him, the government was working to pay the energy sector debts from the bonds raised recently, and assured GRIDCo that ECG would soon pay its debts.