A foreign investor, having already committed $30 million to feasibility studies for renewable energy projects in Ghana, is reportedly encountering significant regulatory and bureaucratic challenges.
The challenges revealed by Dr. Steve Manteaw, Chairperson of the CSO Alliance on Political Manifestos, highlight broader concerns about governance and the business environment in the country’s energy sector.
Speaking on TV3’s NewDay program on Tuesday, November 19, 2024, Dr. Manteaw stated that the investor has faced persistent demands for bribes and equity stakes in exchange for essential regulatory approvals.
“The investor expressed frustration over the rent-seeking culture within the current government, which has effectively stalled progress on the project,” he said.
A Hostile Investment Climate
The investor’s plight, according to Dr. Manteaw, is emblematic of a wider perception of Ghana as a difficult place to do business, particularly in sectors requiring heavy regulatory oversight.
“The entire investment environment in Ghana is seen as very hostile, with complaints of extortion and bureaucratic inertia prevalent across the industry,” he noted.
Such issues stand in stark contrast to Ghana’s ambitious renewable energy goals, with the ruling New Patriotic Party (NPP) pledging to add 2,000 megawatts of renewable energy capacity to the country’s energy mix.
He described the goal as “overly ambitious,” noting that renewable energy currently accounts for just 1% of Ghana’s energy mix, far short of the 10% target set by the government.
“To scale up renewables to such an extent suggests generating more power from renewable sources than from fossil fuels which is a near impossibility given our current infrastructure and policy framework,” he argued.
The investor’s stalled project underscores the disconnect between Ghana’s green energy ambitions and the structural issues that continue to plague its energy sector. With global investors increasingly seeking sustainable projects, he warned that Ghana’s inability to align its policies with international best practices could leave the country trailing in the renewable energy race.
“To attract the scale of investment required, Ghana must overhaul its regulatory framework, tackle rent-seeking practices, and create a genuinely enabling environment for renewable energy investors,” he noted.
Structural Reforms Urged
Speaking further during the panel discussion, Dr. Manteaw underscored the need for comprehensive reforms to address regulatory bottlenecks and attract private-sector investment into the renewable energy sector.
He cited the absence of a net metering framework as a critical shortfall, which discourages individual and institutional adoption of solar energy by failing to compensate for excess power fed into the national grid.
He also called for differentiated tariffs for renewable energy and fossil fuel-generated electricity, arguing that a uniform pricing structure undermines the competitiveness of the renewable energy sector.
novanreport
