Government has secured a $1billion loan facility from the Chinese Development Bank for the Gas Infrastructure Project (GIP) scheduled to take off next year.

The project when completed, would process gas from the Jubilee Field and other fields when the product come on stream, to power thermal plants which constitute about 40 per cent of the current energy mix.

Dr. Joe Oteng-Adjei, Minister of Energy announced this in Accra on Wednesday at the Meet-The-Press Series.

“The government as a matter of urgency is encouraging Independent Power Producers (IPPs) to invest in additional generation. The concerns usually raised by IPP... which include uncertainty in gas availability, pricing, off-taker and financial credibility are being tackled seriously,” he added.

Dr. Oteng-Adjei said the project included other measures being undertaken by government to normalise the current situation in the power sector, which in the last few months had seen major operational challenges and unexpected events that had resulted in reduced power supply in some parts of the country.

He apologized to Ghanaians for the nationwide power outages that occurred on three different occasions in the first quarter of the year, saying, concrete steps were being taken to address these temporal challenges and ultimately improve the power situation before close of the year.

The Sector Minister said two of the outages were as a result of equipment failure and the last one was due to the inability of a system to withstand a sudden and large disturbance from neighboring Cote d’Ivoire system.

He said instead of the power sub-sector to grow at a rate higher than the GDP, it was rather struggling to keep pace with the load demand bolstered by the phenomenal economic growth rate.

Dr. Oteng-Adjei indicated that gas supply for fueling Ghana’s power plants from Nigeria had been quite erratic this year, averaging around 55 million standard cubic feet (MMscf) daily, instead of a contractual volume of 110MMscf/day at an expected minimum of 90MMscf/day.

He noted that supply had been stabilized but had been consistently below the minimum 90MMscf, adding that talks were on-going between the Nigeria suppliers to do well and stick to the rules of the agreement.

Dr. Oteng-Adjei however said should it become necessary to ration power, industry would always be given the highest priority while the Electricity Company of Ghana and Volta River Authority would intensify customer education on efficient energy consumption and the operation of electrical appliances in homes.

The utilities would continue to publish the timetable for areas that would be affected by power rationing.

The Minister said the recent rainstorm which affected parts of southern Ghana in May, left most parts in darkness resulting in power outages in Accra, Tema, Takoradi and Cape Coast; saying, immediate actions had been taken to restore power supply to these areas.

He said to minimise the effect of future storms on the distribution network, the Ministry was working with ECG to strengthen distribution network assets in its operational areas, especially around the coastal belt.

“We are procuring for installation, insulated conductors or Aerial Bundled Conductors to address low voltage challenges. The insulated conductors would be installed at the coastal and forested areas to prevent frequent power outages.”

Dr. Oteng-Adjei announced that government had increased electricity generation capacity from 1810MW in 2009 to 2185.5MW indicating an addition of 375.5MW in 2012 but there was still a major challenge confronting the power system which related to the capacity within the system during peak periods.

Peak demand had now risen to 1,726MW supply capacity, however, it has not kept pace with this growth in demand thereby putting the power system under great stress in 2012.

He said government had put in place short to medium term plans that would address the situation and drastically improve the quality of power supply to Ghanaians.

Within the next six months 350MW of new capacity is expected to be brought on line.

The Bui Hydro Power Project is expected to be completed in the next 12 months to provide an additional 400MW to the system, especially during the peak periods.**