The Africa Centre for Energy Policy (ACEP), an independent think-tank, has welcomed government’s move to pay debt owed by the Volta River Authority (VRA) to banks and supplies.

VRA is a strategic institution in the country’s power sector, producing about 2,400 megawatts of the total 4,000 capacity power generation.

However, the debt burden of the Authority has increased over the past several years due to a combination of operational and financial difficulties.

The indebtedness makes it difficult for the company to pay millions of dollars owed Ghana Gas, the West African Gas Pipeline Company (WAPCo) and the several independent power producers in the country.

Government has indicated the VRA legacy debts of Gh2.2 billion will be paid from a special account opened to receive the proceeds of the Energy Sector Levy.

Speaking in an interview with 3news.com, Head of Policy Unit at ACEP, Dr. Ishmael Ackah, said government’s intervention to settle the VRA debt is a step in the right direction.

“It is good that the government has come in to help; VRA’s debt as at now is about Gh6 billion and paying about Gh2.2billion is quite good,” he said.

Fifty per cent of the funds accruing under the Power Generation and Infrastructure Support sub-account under the Energy Sector Levies Act (ESLA, 2015) will be used to retire the legacy debts.

Dr. Ackah however says transparency in the management of the Energy Sector Levies will inure to the benefit of Ghanaians.

“Energy Sector levies are paid by citizens so we’d want to know how much we’re receiving, so if there could be semi-annual accounts to citizens that this is how much we received from last year, and this is how much we paid and this is the balance, at least it will promote transparency,” he suggested.

By Kofi Adu Domfeh | 3news.com | Ghana