- The Africa Sustainable Energy Centre (ASEC) has issued a stark warning to the Ghanaian government about the potential risks of merging VRA and BPA assets.
- ASEC noted that VRA and BPA had played crucial roles in meeting the country’s target of 10 per cent renewable energy integration by 2030.
The Africa Sustainable Energy Centre (ASEC), a leading energy think-tank, has issued a stark warning to the government of Ghana about the potential risks of merging Volta River Authority (VRA) and Bui Power Authority’s (BPA) assets.
ASEC described the move as unnecessary and potentially catastrophic for the country’s energy sector. “The merger of VRA and BPA and separation of VRA’s thermal power will usher in Ghana’s energy security collapse. For years, VRA has managed a robust energy portfolio that includes solar, thermal and hydropower, and dismantling this carefully balanced structure would jeopardise the country’s power stability,” the think-tank said.
The warning follows growing opposition to a draft bill proposing the merger of VRA and BPA, consolidation of the Northern Electricity Distribution Company (NEDCo), and establishment of an independent Thermal Power Authority that subsumes VRA’s thermal plants.
ASEC argued that VRA’s proven track record, including a profit of GH₵156million in 2020, demonstrates the institution’s capacity to manage its assets without intervention.
“There is no need to fix what is not broken,” ASEC said, cautioning that hydropower assets, by nature, tend to operate as a monopoly – and consolidating these under a single entity could stifle competition and innovation.
The think tank also highlighted Bui’s contributions to the country’s renewable energy goals through its floating solar project. It was noted that VRA and BPA had played crucial roles in meeting the country’s target of 10 per cent renewable energy integration by 2030.
In addition to potentially disrupting renewable energy goals, ASEC contended that the government’s plan to privatise VRA’s thermal assets could destabilise one of the nation’s key power producers.
“VRA has played the role of a ‘social powerhouse’, acting as a buffer against sharp electricity price hikes, especially from Independent Power Producers (IPPs),” ASEC stated. They warned that privatising VRA’s thermal assets would expose consumers to price increases driven by market forces.
ASEC further argued that privatisation should only be considered when a public entity consistently underperforms, which is not the case with VRA. They noted that removing thermal assets from VRA’s portfolio would severely compromise its ability to ensure a reliable energy supply, as thermal power helps stabilise VRA’s revenue streams.