Peacefmonline.com can confirm that Government has suspended its concession agreement with the Power Distribution Services (PDS).
This means the Electricity Company of Ghana (ECG) is back in full control of electricity matters.
Peacefmonline can also reveal that the Energy Commission has moved to revoke PDS’ distribution license and allow ECG to go back to work while government undertakes a full-scale enquiry.
A statement signed by the Information Minister, Kojo Oppong Nkrumah, late on Tuesday, disclosed that the decision was taken after government detected “fundamental and material breaches of PDS’s obligation in the provision of Payment Securities (Demand Guarantees) for the transaction which have been discovered upon further due diligence.”
According to the statement, “The Demand Guarantees were key prerequisites for the lease of assets on 1st March, 2019 to secure the assets that were transferred to the concessionaire.”
“The government is conducting a full enquiry into the matter, and the outcome will inform the next course of action. Government has taken steps to ensure distribution, billing and payment services continue uninterrupted,” the statement added.
“The general public and customers are assured that this development will not interfere with the distribution of electricity services to customers,” the statement clarified.
What Really Went Wrong?
Sources say it appears PDS allegedly committed some sought of “fraud” during the agreement phase with government. Snippets of information received indicates that following the transfer of ECG’s assets and operations to PDS on the 1st of March, 2019, ECG, acting as the beneficiary of the Demand Guarantees, has subjected the Guarantees submitted by PDS to further due diligence tests. ECG received a letter from Al Koot, dated 16 July 2019 that claims, among other things, that the officer who executed the Guarantees from Al Koot was not authorized and that the Guarantees are null and void. The letter also stated that the officer had allegedly committed “fraud”. Insider information further revealed that the alarming development resulted in meetings with officials of Ministry of Finance and ECG as well as with President Akufo-Addo. After the meetings Government decided to crosscheck the information contained in the Disclaimer Letter by sending a Delegation of Stakeholders to Doha, Qatar, on Wednesday, 31st July 2019 to meet with officials from Al Koot. Prior to the trip by the Government Delegation and their report, the Government, therefore, decided, as a precautionary measure, to set aside the Concession Agreement with effect from Tuesday, 30th July 2019.