Contrary to speculations in the public sphere that the 400MW Bui power plant has been a ‘white elephant’, its management argues that it has been “a very profitable investment,” whilst delivering critical support to power stability.
At a press briefing on Monday, management of the plant said since 2014, a total of 2,960 gigawatt hours of electricity has been generated, from an average daily generation of 220MW of power.
Plans, the management said, are afoot to make it the first hybrid generation plant in the country by the end of 2018, through the incorporation of renewable energy, particularly solar.
The company has been working to roll out a 250MW solar project, which its CEO, Fred Oware, said would be done in phases of 50MW each, so that lessons can be learnt from one phase to the next.
The plant has three generating units, with each having the capacity to generate 133MW of power and a mini plant of 4MW, totaling 400MW.
Cost and loan repayment
Initially estimated to cost US$622 million, the plant was eventually build at a total cost of US$790 million.
This, the company said, arose from “unanticipated effects of the 2008 global financial upheavals as well as unforeseen essential works and the inadequacy of the budget provided for some line items in the EPC Contract, totaling US$168 million.”
The Government of Ghana provided US$60 million of the initial cost, whiles the Eximbank of China provided a loan of US$562 million, made up of a Concessionary Loan of US$268.5 million and a Buyer’s Credit Loan of US$293.5 million.
In December 2013, government secured the additional funding of US$168 million, bringing the total project cost to US$790 million.
The CEO of the company, Fred Oware, told journalists that the plant, which sells power to the ECG at about 10cents kWh, has been so profitable that they are on their way to paying off the buyer’s credit component of the loan.
Due to its profitability, he added, government has even decided that they should take on the concessionary aspect of the loan – which is a government to government arrangement – once they are done paying off the buyer’s credit.
“I dare say that in terms of generation and how much we have earned within the period, from 2013 to when generation started to date, we have made enough to pay for the original buyer’s loan…So it has been a very profitable investment,” Fred Oware said.
Merger with VRA
Government has decided that the Bui Power Authority be merged with the Volta River Authority, as it plans to decouple the thermal and hydro functions of the latter.
To that end, it has put a committee in place to advice, which committee includes Fred Oware of Bui Power Authority.
Asked what he made of the plans to merge the two entities, Mr Oware said it was “early days” and that he could not comment on same, adding that “position papers” were now being put together by various parties, including his own entity.
He said the company intends to go big on renewable energy moving forward, to which end it has finished the testing and commissioning of 250MW switchyard facilities purposely built to evacuate solar power.
“Adequate lands have been demarcated for solar parks to support the programme. Compensation to farmers has been settled. Permitting and licensing procedures are being followed. We are certain that construction works will start in the first quarter of next year in modules of 50MW pv solar park per project,” a statement signed by Fred Oware said.