Prime News Ghana

Suspension of PDS' concession won't interfere with electricity distribution - Gov't

By Justice Kofi Bimpeh
Kojo Oppong Nkrumah
Kojo Oppong Nkrumah
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Government has assured that the suspension of the Power Distribution Services, PDS' concession agreement will not interfere with electricity distribution in the country.

The Ministry of Information on Tuesday evening announced the suspension of the PDS with immediate effect.

The decision according to government was taken following the detection of fundamental and material breaches of PDS’ obligation in the provision of Payment Securities (Demand Guarantees) which was discovered upon “further due diligence.”

“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,” a statement signed by the Minister of Information, Kojo Oppong Nkrumah stated.

"Despite the action, the statement clarified that “The general public and customers are assured that this development will not interfere with the distribution of electricity services to customers.”

“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."

Background

PDS officially took over services from the Electricity Company of Ghana (ECG) in February 2019 after Meralco consortium, a major shareholder in PDS won the bid to run the power service.

PDS has taken over the management and operations of the ECG after Meralco consortium, a major shareholder in PDS won a bid to manage the national power distributor.

The company was expected to turnaround the operations of ECG to make it profitable.

It was also supposed to improve access to electricity while cutting down on wastage in the system as well as blocking all leakages that drained the financials of ECG.

PDS’ operations over the past few months have been fraught with many challenges including frequent power cuts and huge debt it owed some Independent Power Producers (IPPs).

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