Sunon Asogli threatens shutdown over accumulated debts

Sunon Asogli Power (Ghana) Limited, an independent power producer (IPP), has threatened the closure of its 560 MW plant following the government’s delay in settling the debts owed them.

In a letter addressed to ECG and copied to other government agencies, the company mentioned that attempts by their management to find an appropriate resolution with the government on outstanding liabilities have been unsuccessful, thus the decision to shut down.

“Sunon Asogli Power (Ghana) Limited Company announces with regret an indefinite suspension of operations at the Sunon Asogli Power Plant, effective Monday, December 4, 2023, at 6 p.m. This difficult decision became necessary due to avoidable delays in payment from the GoG/Electricity Company of Ghana for power supplied, as well as the unproductive engagements to find an amicable solution,” the letter read in part.

“The accumulating unpaid bills have significantly impacted our operational capacity, making it unsustainable to continue without addressing these financial challenges,” the letter added.

Over the years, Independent Power Producers (IPPs) have expressed dissatisfaction with the government’s debt to them. Nevertheless, a number of initiatives—including threats to halt operations—have not produced any appreciable outcomes.

To prevent any discontinuation of power supply, a government team comprising the Managing Director of ECG had drawn up a payment plan with the IPPs to settle its bills.

According to sources, the government owed the IPPs approximately $1.6 billion as of July 2023.

Although the ECG over the past few months has improved significantly on its revenue-generating capacities, Managing Director Samuel Dubik Mahama, in a recent interview with an Accra-based TV station, said there is much more his outfit can do.

Meanwhile, Sunon Asogli, in a fresh letter, says that it has suspended its decision to shut down their plants for one week, following assurances it has received from the Ministers of Finance and Minister of State at the Ministry of Finance.