Dr. Kwabena Donkor, the Power Minister, says current power challenges facing the country are opportunities for local investors to shift their focus from trading to investing in the lucrative business of power generation.

"Our generation has not kept up with demand: demand is growing by 12 percent per annum. Some see it as a challenge, but I see it as an opportunity. I want to see more local investors switching from buying and selling to investing in power," he said.

He was speaking at the T4 thermal project construction signing ceremony between the Volta River Authority (VRA) and TecnicasReunidas of Spain (TR Spain) to contract the Spanish company for construction of a 186MW combined thermal plant within the power enclave in the Western Regional capital.

Local investment in the power sector has been limited. Mention can be made of the Sunon-Asogli gas-reliant thermal plant and CENIT among the sprinkling of local investments or partnerships in the sector.

Limited local investor interest has been attributed to the below par tariff regime in the country, which is comparatively cheaper than that of our neighbours in the sub-region, a situation acknowledged by the Power Minister

"Thermal power generation is going to cost more than hydro. We are no longer going to have cheap power; the price of power will be in the region of our neighbours in the West Africa sub-region. Ghanaian consumers must be efficient in power use."

Kirk Koffi, VRA's Chief Executive said: "The T4 project is one of the joint ventures we are undertaking to add on more generation. We are talking to others to come in and partner the VRA in more joint ventures. Independent Power Producers (IPPs) must add onto the current installed capacity or the VRA, with government support to do it".

TheT4 project The T4 project is a combined cycle thermal power generation project that is expected to be completed in about 30 months.

The project’s first stage involves installation of a simple cycle GE Frame 9 machine to generate 126megawatts of power within 20 months from the date of commencement. The plant will be able to run on both gas and crude.

The second stage involves construction of the steam turbine to generate an additional 60megawatts.

The entire project is expected to cost about US$239million and is to be executed by the contractor Tecnicas Reunidas of Spain (TR Span).

Export Credit Agency (ECA) Funding from the Spanish government is expected to fund 85 percent of the project’s cost, with the counterpart funding of 15 percent to be provided by the VRA.

The VRA will be required to service the facility over a 15-year period.

Isaac Bedu, Manager, Programme Management VRA said: "It was an International competitive tender, whereby we asked the companies to come with Export Credit Agency (ECA) funding. We expect to reach financial closure within the next six months so the project can start.

"On our part, we need to show that we can pay back the money," Mr Bedu said.

Generation deficit The lack of enough generation in the system has prompted electricity load-shedding, much to the disdain of especially industrial consumers.

Thermal generation has also been an expensive venture over the years in respect of the huge sums of money required to purchase crude. VRA at times has had to fall on local banks for loans to purchase crude oil for thermal generation.

The start of gas processing in the Western Region is expected to help bridge the shortfall in hydro generation, but not necessarily to correct the power sector’s deficit.

The 2015 budget approved by Parliament grants utilities the concession to go to the capital market, on the strength of its own balance sheet, to raise capital for their operations and various expansion projects.