|
Read our exclusive interview
|
 VOLTA RIVER AUTHORITY
Mr. Gilbert O. Dokyi
The Chief Executive
PO Box MB 77
Accra - GhanaTelephone: (233-21) 666037
(233-21) 669029Mobile: (233-24) 318020Fax: (233-21) 664705
(233-21) 662610E-mail: orgsrv@accra.vra.com |
The Volta River Authority (VRA) was established under the Volta River Development Act, Act 46 of 1961 as a body corporate. The primary functions of the VRA include the development of the hydroelectric potentials of the Volta River and construction and maintenance of a transmission system for the supply of electrical energy for industrial, commercial and domestic use.
POWER OPERATIONS
 Generation
The Authority's total installed electricity generation capacity of 1,432 MW. This is made up of two hydroelectric plants on the Volta River, with installed capacities of 912MW and 160 MW at the Akosombo and Kpong Generating Stations, respectively; 30 MW Diesel Plant at Tema; and a 330 MW Combined Cycle Thermal Power Plant at Aboadze near Takoradi The two hydro plants are capable of providing firm energy of approximately 4,800 GWh/year and long-term average potential energy of 6,100 GWh/year. The 330 MW TTPP is also capable of providing 2,457 GWh at 85% availability.
In order to ensure that adequate power is always available for the development of Ghana, the VRA in a joint venture arrangement with CMS Generation of Michigan, USA, is proceeding with the expansion of the Takoradi Thermal Power Plant to its ultimate capacity of 660 MW on a fast track basis. Two combustion turbine units of 110MW each are scheduled to commence commercial operation in year 2000.
In addition to the thermal complementation, the VRA has signed a Memorandum of Understanding (MOU) with a Development Consortium led by Brown and Roots of the United Kingdom to develop the Bui Hydro-electric Project. The duration of the MOU is 20 months during with all the required engineering studies, including the Environmental Assessment Studies for the project implementation would have been completed.
Transmission
The VRA' s transmission system comprises 35 substations and approximately 4,000 circuit kilometres of transmission lines. VRA also operates interconnections to la Côte d'Ivoire in the southwest; Lome, Togo in the southeast and to Dapaong, Togo in the northeast of Ghana.
The VRA has established a telecommunication company known as Volta Telecommunications Company Limited (Volta Com.). The mission of VoltaCom is to commercialise the fibre optic cables installed on the high Volta transmission lines. The company has been registered to provide voice, data, video and other value-added communication services. It will establish, manage, sell, hire out, lease and maintain telephone exchanges, stitches, fibre terminals, microwave radio systems, cable communications, satellite systems and any other system for communication.
VoltaCom has been licensed to provide data communications/carrier services to any interested person and, in the case of voice telephony, to any of the two currently licensed public telephone service providers in Ghana.
Distribution
In 1987, VRA assumed responsibility for the distribution of electricity in the Northern Sector, namely, Brong-Ahafo, Northern, Upper-East and Upper-West Regions. The Northern Electricity Department (NED) was then created to carry out this function.
Customers
VRA sells bulk electricity locally to Electricity Company of Ghana (ECG), which is responsible for the distribution of electricity in Southern Ghana. It also sells bulk electricity to a limited number of major consumers comprising mining companies and industrial customers totalling about fifteen (15). It sells bulk electricity in foreign exchange to VALCO, which operates an aluminium smelter at Tema, Ghana. It exports power to Togo and Benin (CEB) and interchanges power with la Côte d'Ivoire (CIE).
NON-POWER OPERATIONS
VRA is also responsible for providing facilities and assistance for the socio-economy development of the Volta Basin. In fulfilment of this function, the Authority has sponsored the establishment of the following subsidiary companies: Kpong Farm Limited, Akosombo Hotels Limited and the Volta Lake Transport Company Limited (VLTC) on behalf of the Government of Ghana.
The Kpong Farms Limited is involved in the commercial production of crops and livestock using modern agricultural techniques, marketing farm produce, meat processing. It also serves as a demonstration farm for the promotion of agricultural research.
The Akosombo Hotels limited runs a 3-star hotel, restaurant, modern conference/seminar facilities, and pleasure activities and promotes tourism.
VLTC operates river transportation for passengers, bulk haulage, and haulage of petroleum products on the Volta Lake. It also operates cross Late Ferry services along the lake.
VRA operates as a local authority for the Akosombo Township, and exercises administrative responsibility over its Akuse Township.
Environmental Issues
VRA implements various programmes aimed at mitigating the adverse environmental effects of its operations, and also ensure the well being of the communities in the Volta Basin.
The programmes include dredging activities at the estuary of the Volta River to reduce the incidence of bilharzias, and also restore the ecosystem in the area. Various reforestation projects are also being carried out to restore forest vegetation cover over the immediate highlands bordering the Volta Lake.
The VRA has also commissioned a study which ill help design and implement appropriate socio-economic programmes to enhance the quality of the communities in the Lower Volta area. Also, since 1966, Vra has committed US$500,000 annually to a Resettlement Trust Fund to carry out socio-economic projects within the Volta lake Basin.
CORPORATE VISION, MISSION STATEMENT
Corporate Vision
The Volta River Authority seeks to achieve excellence as a leading, dependable and financially sound multi-business enterprise that supplies electricity, telecommunications and related services/products to meet the demands of its customers at competitive prices.
Corporate Mission
The Volta River Authority is committed to being the leading supplier of high quality electricity at least cost and ensuring the satisfaction of its stakeholders. It aims to manage a portfolio of viable businesses in generation, transmission, distribution, telecommunications, other energy infrastructure and related services within a privatised business setting.
In line with the objectives of Ghana's Vision 2020, which among others, maintains that energy shortages should not be a bottleneck to the economic growth of Ghana, VRA will endeavour to participate in partnership with private entrepreneurs to develop viable energy resources for Ghana.
VRA strives to achieve a dominant share of the power markets both in Ghana and the West African sub-region and will pursue co-operation with other power utilities to improve reliability of power supply and harness corporate resources.
To our customers, both domestic and foreign, VRA will supply safe, reliable and competitively priced electricity and telecommunication services; and promote efficiency in the use conservation of power. Thus, it will facilitate socio-economic development and thereby improve the standard of living of Ghanaians.
VRA's duty to its owner, the state of Ghana, is to maintain a well managed, financiallly sound and commercially viable, decentralised power utility with subsidiaries that value healthy competition and private sector participation.
To its other financiers, VRA will remain a financially and economically viable corporate enterprise, committed to long-term profitability and meeting its debt servicing obligations.
VRA seeks to provide all its employees opportunities for maximum self-improvement through training and development programmes, tailored to suit individual abilities and corporate needs. It also seeks to provide job security and competitive compensation and benefits package to retain and motivate appropriately skilled employees.
VRA will position itself ahead of any changes/reforms in its area of business. Thus, it is restructuring its operations into independent and viable limited liability companies. Its management framework will encourage entrepreneurship and ensure continuous improvement in its operations. It will operate a transmission business that ensures a policy of open and fair access to all power producers within the Power Sector regulatory framework as provided by law.
VRA will pursue programmes to mitigate the adverse environmental effects of its operations on communities and generally contribute to the health and welfare of such communities. In addition, it will be committed to the socio-economic development of the Volta Basin.
OPERATIONS REVIEW
(a) Engineering Design and Construction
The Authority continued to pursue its developmental activities in relation to extension of grid supply, enhancement of power supply and system reliability, regional integration and interconnection and other infrastructure works.
We continued work in the Northern, Upper East and Upper West Regions on VRA's component of the National Electrification Programme (NEP), which is part of Government's Vision 2020. A total of 76 towns were connected to the power grid and 11,821 connections were made in the aforementioned regions. At the end of the year, a total of 134 towns to be connected under the Authority's current component of the NEP. The township of Yeji and nine other surrounding towns were also connected to the power grid under a Japanese-Ghana Government funded project for rural electrification.
In pursuance of the Authority's mission to achieve a dominant share of the power market in the West African Sub-region and co-operation with other power utilities, efforts continued to be made towards interconnecting the Ghana and Burkina-Faso power systems. Two separate projects are being pursued in this regard: extension of supply to two border towns in Burkina Faso namely, Po and Leo from Navrongo and Tumu in Ghana, respectively, and the proposed 225kV interconnection between Bolgatanga and Quagadougou. In relation to the power supply extension to the Burkina-Faso border towns, efforts were made to remove obstacles impeding implementation. A draft Power Purchase Agreement was agreed upon and arrangements are underway to have it executed. An African Development Bank mission visited Ghana and Burkina Faso to undertake an assessment for the Ghana-Burkina Faso 225kV Interconnection. This was in response to our request for funds towards implementatin of the final project preparatory works.
To improve and enhance the reliability of supply to our customers, we embarked on a number of activities. Work started on the Accra West Substation Project, which would enhance the supply reliability to Accra with the construction of a second bulk supply station. We signed two contracts for the implementation of the Sawla Substation Project, involving upgrading the operating voltage of the Techniman-Sawla section of the Techiman-Wa Transmission line, from the present 34.5kV to 161kV. It is expected that with the completion of the Sawla project in 2001, power supply reliability to the Upper West Region would be enhanced and electrification of nine towns in the Northern and Upper West regions would be facilitated.
Appreciable progress was made on the Bui Hydro-electric project. Working with the Government's Bui development Committee, we signed a Memorandum of Understanding (MOU) with a Development Consortium led by Brown and Root of the United Kingdom. By the terms of the MOU, it is expected that all preparatory activities towards project implementation, including Environmental Impact Assessment, would be completed within twenty months. The Bui Project is expected to increase the country's energy supply by about 1000 Gwh per annum.
The implementation of our Takoradi Thermal Power Project (TTPP) also made some progress. The third unit of the Plant, the Steam Turbine and Generator was synchronised in July 1999, injecting an additional 110MW into the national grid. However, some problems associated with the commissioning of the Steam Turbine Plant are being addressed. We expect the Steam Turbine problems to be resolved soon so as to receive the incremental efficiency benefits of the Combines Cycle facility. Work also commenced on the expansion of the takoradi Plant by two 110MW units under the joint venture arrangement between VRA and CMS Generation of Michigan.
During the year, we completed the installation of about 265km of Optic Fibre Groundwire (OPGW) on the Akosombo-Kumasi transmission line and OPGW installation on the Aboadze-Prestea line. Outstanding transmission system and Substation modification works related to TTPP were also completed.
As part of our effort to mitigate adverse environmental impacts of our Takoradi Plant, we continued to monitor the ambient air quality at the three monitoring stations at Beposo, Aboadze and the Plant site, to ensure compliance with environmental standards set by international and national regulatory bodies. In addition, noise monitoring, regular survey for the presence of flammable gases and routine inspections were carried out at the Plant site.
Our efforts at developing demand side management options also continued during the year. As part of our initiatives, a document on specifications and standards for energy efficient lighting, equipment and appliances was prepared to serve as an information and educational outreach resource. Also, under a Passive Infra-red Sensor (PIRS) Impact Assessment programme, a load survey was conducted, to identify energy saving opportunities. It was observed that applying the PIRs to air-conditioning loading could save about 30% of the existing energy use. The findings are expected to be widely applied to achieve more effective energy usage.
The performance of the Akosombo and Kpong Dams continued to be monitored on a regular basis. The inspection and analysis of the quality and quantity of seepage showed that both dams were in satisfactory condition. Upon the recommendation of the Dam Review Board in 1995, a permanent ventilation system has been installed in some of the Dam adits and these continued to perform satisfactorily. Arrangements were also make for the constitution of the Dam Review Board for the 5-year Dam review scheduled for early 2000.
At the end of the 1999 rainy season, the estimated net inflow into the Volta Lake was 56,620 MCM (45.9MAF). This was about 50% above the long-term annual average inflow of 37,600 MCM (30.50 MAF) and was the eighth highest inflow on record. The elevation of the Volta Lake on January 1, 1999 was 75.93m (249.12ft.), and at the end of the dry season, it was 73,00m (239.52ft). At the end of the rainy season, the Lake had achieved an elevation of 80.44m (263.90ft). This was a rise of 7.43m (24.38ft) over the period.
Water Balance
The Water Balance for the Volta Lake for 1999 was as follows:
| Storage at January 1 | - 89.890MCM
(72.9 MAF | | Elevation | - 75.93m NLD
(249.12ft) | | Storage at December 31 | - 117,780 MCM
(95.5 MAF) | | Elevation | - 79.76m NLD
(261.69ft) | | Change in Storage | - 27.890 MCM
(22.6 MAF) | Net Annual Inflow
(excluding losses) | - 56.620 MCM
(45.9 MAF) | | Plant discharge for Power Generation | - 31.130 MCM
(25.2 MAF) | | Net Losses | - 2,400 MCM
(1.9 MAF) |
Note: (MAF – Million acre feet; MCM - Million Cubic Metres NLD – National Level Datum)
Hydrology Data
| | 1998 | 1999 | | The lake level as at 1st January | 74.54m (244.55ft) | 75.93m (249.12ft) | | The lake level as at 31st December | 75.95m (249.17ft) | 79.76m (261.69ft) | | The minimum level recorded | 72.22m (368.93ft) | 73.00m (239.52ft) | | The highest level recorded | 76.81m (252.0ft) | 80.44m (263.90ft) |
(b) Power Generation, Transmission and Distribution
The Authority recorded the highest ever peak load
demand of 1061.6 MW on its power system on December
29, 1999. This exceeded the previous peak demand
of 1034.6 MW, recorded in 1998, by 2.61% (27.0MW)
A total of 5,924 Gwh of electricity was generated
at our generating plants at Akosombo, Kpong, Tema
and Aboadze, an increase of 18.18% over the 5,012
Gwh generated in 1998. Unlike the previous year
when as many as ten incidents of total system
voltage collapses were recorded, primarily as
a result of the energy crisis, the year 1999 recorded
only one such collapse. This was the result of
a fallen tree on a conductor on the VRA-CIE tie-line.
Supply was restored after seven minutes.
| To ensure the optimum operation of our power system we continued with our maintenance activities on all our generation, transmission and distribution facilities and equipment. At the Akosombo Plant, preventive maintenance activities planned for the generating nits and other auxiliary equipment such as the generators, transformers, governors, intake hoists and switchgear at the switchyard, were accomplished according to the schedules. In addition, all corrective maintenance activities resulting from equipment malfunctioning were carried out successfully.
Under the Akosombo Generating Station Retrofit Project, Unit 3 was taken out of service for a major overhaul. In preparation for the Retrofit Project, the 450 ton and 85 ton gantry cranes were inspected, and found to be generally in good working condition. Some new equipment were also installed and commissioned at the Plant, to enhance operations. These included a newly calibrated 48VDC – 240VAC inverter for the Landys and GYR energy meters and pulse converter at the Switchyard Control Room.
Corrective maintenance activities were also carried out on all the generating units of the Kpong Plant and the Tema Diesel Station. At the Takoradi Plant, various maintenance and inspection works were carried out on the Combustion Turbines and Balance of Plant equipment. The major activities were the Hot Gas Path Inspection, involving complete change of combustion and hot gas path parts of Units 1 and 2, after 8,276 and 10,600 running hours, respectively.
The performance of major transmission system equipment namely transformers, high voltage and low voltage and low voltage SF6 and bulk oil circuit breakers, reactors, capacitor banks and other auxiliary equipment was satisfactrory.
The average in-service period of the 56-transmission line sections in operation during the year was 98.97%, compared to the year's target of 98.8%. In comparison to the 1998 performance of 99.04%, the relatively low performance in 1999 was due mainly to outages taken to facilitate various work programmes. These included major rehabilitation works on the Volta-Achimota and Akosombo-Lome lines, the stringing of OPGW cable on the Prestea-Aboadze line, as well as the provision of clearance for works on some transformers.
Several circuit breakers were overhauled, tested and returned to service; while the transformers were overhauled, relocated or new ones installed.
Routine ground patrol and aerial inspection were conducted on all the system lines with the exception of the Prestea-Abobo line, which could not be fully patrolled due to access problems. Security ground patrols aimed at detecting promptly acts of vandalism on towers as well as tower auditing were also carried out on some of the line sections. Other major maintenance works carried out included the monthly inspection of all the Switchyards in the system, and the inspection and servicing of all battery banks at the Substations.
Preventive maintenance work was also carried out at the remote substations. Work involved routine Remote Terminal Units (RTUs) checks, rectification of equipment defects; transducer installation, upgrading and commissioning; calibration of transducers, and diagnostic check of the entire RTU. Following the successful completion and commissioning of Fibre Optic links, there was a tremendous improvement in reliability and quality of data transmission from the RTUs at Achimota, World Investment News Ltdba, Cape Caost, Takoradi, Aboadze and Esiama.
To ensure Y2K compliance, modifications were carried out on some programme modules of the SPIDER system software. The entire master station software and hardware system was successfully tested for Y2K compliance. In addition, the Power Application Software was successfully installed on the SPIDER SCADA/EMS Network Control System.
The operations of the Northern Electricity Department (NED) saw increases in customer population, energy sales and increased revenue. Customer population increased by 23%, from 81,618 in 1998 to 100,925 in 1999. Most of the growth resulted from the connection of additional towns to the national grid under the ongoing National Electrification and Self-Help Electrification Programmes. There was also an improvement in revenue collection. The overall collection rate was 82.8%, compared to 62.5% in the previous year. The receivable lag also improved from 181 to 164 days at the end of the year. The increase in revenue collection was due to various measures taken such as increasing the number of bonded cashiers and collection points, as well as the stepping up of disconnection of defaulting customers.
Despite efforts being made to limit system losses, these rose from 21.8% to 24.5%. This is attributed to several factors, including an ageing distribution network, inadequate rehabilitation, theft and bulk supply metering inaccuracies at some bulk supply points. A vigorous loss reduction programme is currently underway to address this problem of high losses. The programme is focused on relocation of meters, checking of meter tampering, replacement of faulty meters and increased surveillance.
The pilot project on Pre-payment Metering was completed during the year. Results from an end of project customer survey indicated that about 98% of customers were satisfied with the meters, and preferred them to credit meters. Also about 65% of the customers claimed that the prepaid meters had helped them control their electricity consumption. It is envisaged that the prepayment meters will help improve upon revenue collection in the long run.
NED continued to successfully tackle its technical challenges. Through adherence to maintenance schedules on lines and substations, the entire power system performed satisfactorily. Some of the major works carried out were the construction of 13 spans of distribution lines to replace three towers in the Northern area that had collapsed as a result of vandalism. Also, a number of defective equipment including eleven damaged transformers and a 30kV underground cable were replaced.
To meet the challenges of the coming years, NED is developing strategies to ensure better and improved service to its customers. One of the main challenges is the continued rapid expansion of the major urban centres in NED's operational area, and the consequent increased demand on the NED system.
Electricity Production and Transmission
A table of electricity produced and transmitted for 1998 and 1999 is as follows:
see table
Real Estate and Environmental Enhancement
In 1999, the Ghana Tourist Board once again, adjudged the Akosombo township the cleanest town in Ghana. This is in recognition of our attempts at maintaining high standards of cleanliness in the township. The first award was given in 1997.
Environmental issues dominated our activities during the year. We continued with our programme of reducing salitation of the Volta Lake through the restoration of permanent vegetative cover on the slopes bordering the Lake. Under the Volta Gorge Area Protection Programme, we continued our cycle of activities comprising seedling production, planting and maintenance, as well as bush fire management. By the end of the planting season, an area of 124 hectares had been planted with various forest and fruit trees, including cashew, mangoes and coconuts. Since its inception in 1994, the programme has, so far covered over 1,480 hectares of the critical areas facing the lake on both sides,
Following the success for the first phase of the Tree Cover Depletion Minimization Project at Yeji in 1998, and the consequent extension of the project for another three years, we embarked on activities to start the second phase. This project is aimed at the reforesting low slope areas in about 150 lakeside villages. Under the second phase, in addition to ensuring that the target group(s) covered under Phase 1 have understood the new methods of fish processing and tree planting, an additional 1,500 acres of tree cover will be restored. Education programmes are also expected to be pursued to educate people in 50 additional fishing communities on new methods for cooking and fish smoking. The activities also cover strengthening the capability of staff of collaborating agencies, including various units of the Ministry of Food and Agriculture, to undertake relevant extension programmes.
The second phase of the Lower Volta Environmental Impact Studies also ended during the year, thus paving the way for the third phase. The findings of the project so far include the use of animal traction for soil management and the use of a local plant, Moringa oleifera, to improve water quality in the Ada area. An experimental on-land aquaculture project has been constructed at Ada to produce clams, crabs and oysters, as well as to serve as a learning centre for the communities. The project is part of our efforts to assess the environmental implications for our operations in the lower Volta area, and design measures to ameliorate any effects while enhancing the economic lives of the people.
The Water Resources Institute concluded VRA-sponsored studies on Baseline Data on Water Pollution on the Volta Lake and Kpong Headpond during the year. The studies established, among other things, that physical and chemical parameters of the water body were within the acceptable limits set by the World Health Organisation for untreated water. Also, weed infestation has not assumed alarming proportions, although with the use of fertilizer in some farming areas, there could be a proliferation of algae and aquatic weeds in those areas. The Authori8ty is committed to utilizing the data as benchmarks for monitoring water and land pollution in the Volta Lake and Kpong Headpond. The Authority will also take necessary action to eradicate other identified health-related problems, such as malaria, diarrhoea and schistosomiasis, as well as monitoring and control of the water hyacinth week on the Oti arm of the Volta Lake.
The focus of our management information programmes was dominated largely by concern for the Y2K issue. We investigated the Y2K compliance or otherwise of all embedded chips in various computerised hardware throughout the Authority. This involved all production and process control and monitoring equipment within the power system as well as computers and peripheral equipment for business applications and health services.
The Authority's mission critical hardware and software were migranted from the Wang Proprietary platform to client/server architecture using PC-based Local Area Networks to avert the millennium bug. A new financial system was successfully implemented, while a new Human Resource Management system was also commissioned.
Work was intensified on the installation of Local Area Network (LAN) for key work locations. In this connection, the Akuse Campus Area Networks Project was completed to link together discrete LANs in Akuse. The LAN at Tamale was also upgraded, while a new LAN was installed at Sunyani to improve information flow and commercial activities in the NED areas.
The proposed restructuring of VRA will have an impact on the provision of quality Information Technology services throughout the Authority. We are adopting strategies to keep pace with the emerging process, to ensure easy access to information from all operational sites through an enterprise-wide information superhighway to support decision-making. Efforts will be made to interconnect all LANs to a Wide Area Network (WAN) to enable users effectively and efficiently utilize information in all aspects of their business activities.
As a result of the increased inflows into the Volta Reservoir, the Authority was able to increase hydro generation substantially from 3830 GWh in 1998 to 5169 GWh in 1999. This was supplemented by imports from La Coe D'Ivoire amounting to 1032 GWh (1998: 573 GWh) and thermal generation of 755 GWh (1998: 1146 GWh) Transmission losses were 152 GWh or 2.2% (1998: 149 GWh or 2.7%). Consequently, total energy sold in 1999 was 6804 GWh compared to 5437 GWh in 1998.
Revenue from power sales was ¢620.3 billion, as compared to the previous year of ¢419.5 billion. The 48% rise in revenue can mainly be attributed to the 25% growth in energy consumption and the full impact of the tariff increase approved by the Public Utilities Regulatory Commission (PURC) effective, September 1, 1998, which prevailed throughout 1999 but only in four months of the previous year.
The realised revenues were however sufficient only to cover operating but not financing and other costs.
Operating expenses excluding power imports, depreciation, loan interest and exchange fluctuation on foreign debt decreased by 12.7% from ¢230.6 billion in 1998 to ¢201.4 billion in 1999. Operating and general expenses excluding depreciation increased modestly by ¢48.1 billion (16.0%) from ¢309.0 billion in 1998 to ¢357.0 billion in 1999.
The main reasons for the increase in operating costs were:
a) The high cost of thermal generation arising from the massive rise in fuel prices on the world market during the latter part of the year. Crude oil prices rose from $12.00 to $25.00 per barrel during the year.
b) High volume of power import from La Cote D'Ivoire, ¢156.0 billion as against ¢78.0 billion in the previous year. The cheaper imports replaced the use of the Tema diesel Plant and the Takoradi thermal plant as the main source of peaking power.
c) General increases in prices due to 12.4% inflation and 49% depreciation of the cedi (1998: 4.2%).
Consequently, the Authority including Northern Electricity Department (NED) recorded a net operating profit after depreciation of ¢79.2 billion, compared to the previous year's figure of ¢18.7 billion. This represents an improved return of 1.8% on re-evaluated average net fixed assets as against the 0.6% achieved in 1998.
A net loss of ¢282.2 (1998: ¢105.2 billion was however recorded in 1999, after charging interest and commitment charges of ¢40.6 (1998: ¢19.2) billion and exceptional item of ¢84.3 (1998: ¢75.8) billion. This is because the realised revenues at existing tariff levels were not sufficient to cover the impact of the 49% cedi depreciation on foreign debt and financing charges.
The exceptional item mainly represents the cost of supplementary energy incurred in 1999 and payable to VALCO in year 2000 to 2001. The 50% portion due to be paid in year 2001 has been treated as a deferred liability on the Balance Sheet.
Operating, general and financial expenses as a percentage of power sales are as follows:
see table
LIQUIDITY
The Authority recorded a positive cash flow of ¢77.9 billion (1998 deficit: ¢42.8 billion) during the year, mainly as a result of a build up of funds for the purchase of thermal spares and other fixed commitments. Current ratio fell from 1.17 in 1998 to 1.15. The power debtors collection period also deteriorated from 194 days to 205 days in 1999 mainly because of the arrears due from Electricity Company of Ghana (ECG).
As part of the measures agreed to ensure timely payment of power purchases, an escrow account has been set up by ECG to pool its bulk power sales collections to be used to pay debts owed VRA. This has however not been effective because of the fact that amounts lodged monthly in the account are dependent on ECG's collection rate, which has been significantly below 100%.
Nevertheless, the Authority was able to meet its debt service obligations to the lending agencies amounting to ¢56.3 (1998: ¢41.8) billion.
NORTHERN ELECTRICITY DEPARTMENT
The Department achieve a 67% increase in turnover from ¢23.4 billion in 1998 to ¢39.0 in 1999. The rise in power sales is the result of tariff increases effective in September 1998 and 20.9% increase in power consumption.
Electricity purchases increased from ¢17.9 billion in 1998 to ¢29.1 billion in 1999 and total operating costs increased to ¢39.4 billion as against ¢ 25.9 billion in the preceding year.
The Department realised a net loss of ¢14.9 (1998: 11.2) billion. Its liquidity position at Balance Sheet date showed a positive working capital of ¢2.5 billion as against ¢4.2 billion as at December 31, 1998.
2000 OUTLOOK
Total energy demand I the system for the year 2000 is estimated at 8093 GWh. This is made up to total customer demand of 7843 GWh and estimated transmission losses of 250 GWh. The demand for the year represents a 15.3% increase over the 1999 energy consumption of 6804 GWh.
The Authority plans to generate 7569 GWh from its own generation systems. Hydro generation is planned at 6750 GWh and the Takoradi Thermal Plant of the Takoradi Power Company about 819 GWh. The deficit of 774 GWh in the Authority's system supply will be met through imports of 401 GWh from Cote D'Ivoire and 373 GWh from Takoradi International Company (TICO)
Expenditure on systems generation, imports and supply from TICO amount to ¢426.23 billion. Total operating expenses for the year excluding depreciation of ¢201.8 billion is estimated at ¢547.05 billion.
The total capital expenditure for the year is estimated at ¢422.87 billion. ¢342.9 billion would be expended on generation, transmission and distribution projects whilst environmental protection, community welfare, asset purchases and studies will take up the balance of ¢29.50 billion.
The Authority has submitted tariff proposals to the PURC. If the new tariffs are not approved, the Authority will end the year 2000 with an operating profit of ¢141.46 billion, representing a 2.9% return, against the covenanted rate of return on average re-evaluated net fixed assets of 8% and a cash deficit of ¢314 billion. At the proposed new tariffs, the Authority will end the year with an operating profit of ¢388.8 billion, an 8% rate of return on average re-evaluated net fixed assets and a positive cash position of ¢85.24 billion.
It is hoped that tariff increase and Government
intervention to ensure that ECG pays up its receivables
would improve the Authority's liquidity and profitability
performance. |
Electricity Production and Transmission
| | | 1998 | 1999 | | A. | Total Energy generated at Akosombo | 3,166.180 GWh | 4,289.010 GWh | | B. | Total Energy Generated at Kpong Gs | 664.144 GWh | 879.713 GWh | | C. | Total Energy Generated at Takoradi Thermal GS | 1,145.803 GWh | 755.246 GWh | | D. | Total Energy Generated at Tema Gs | 36.603 GWh | 0.338 GWh | | E. | Total Energy Generated at the four Generating
Stations (A + B + C + D) | 5,012.729 GWh | 5,924.307 GWh | | F. | Energy imported from CIE | 573.140 GWh | 1,031.640 GWh | | G. | Energy imported from CEB | - | - | | H. | Total Energy Imported from (CEB and CIE) (F+G) | 573.140 GWh | 1,031.640 GWh | | I. | Total Energy Used at the Four Generating Station | 17.756 GWh | 25.700 GWh | | J. | Total Energy Transmitted (E+H-1) | 5,568.113 GWh | 6,930.247 GWh | | K. | Total Energy Used in the System Substations | 2.742 GWh | 2.742 GWh | | L. | Energy Exported and Sold to CEB from VRA | 459.535 GWh | 325.631 GWh | | M. | Energy Exported and Sold to CEB from CIE
(Energy Wheeled) | 0.000 GWh | 192.856 GWh | | N. | Energy Exported to CIE from VRA
(Inadvertent Exchange) | 0.262 GWh | 0.160 GWh | | O. | Total Energy Exported to (CEBand CIE) (L+M+N) | 459.797 GWh | 518.647GWh | | P. | Total Domestic Sales | 4,977.317 GWh | 6,478.673 GWh | | Q. | Total External Sales (CEB and CIE) | 459.535 GWh | 325.631 GWh | | R. | Total Energy Billed (N+P+Q) | 5,437.114 GWh | 6,804.464 GWh | | S. | Total Energy Lost in Transmission (J-K-O-P) | 128.257 GWh | 123.262 GWh | | T. | Percentage of Energy Lost in Transmission
S/(J-M-K)100 | 2.3% | 1.8% | | U. | Maximum Peak Generated | 1034.6 MW | 1061.0 MW | | V. | Average Demand | 637.66 MW | 794.06 MW | | W. | Load Factor | 61.6% | 74.8% | | X. | Average Plant Discharge at Akosombo GS | 742.89 mc/sec | 923.65 mc/sec | | | | (26,224.1 cfs) | (32604.68 cfs) |
|
| Year | 1999 | 1998 | | | Amount
¢' m | Percentage of Power Sales
% | Amount
¢' m | Percentage of Power Sales
% | | Generation - Hydro | 14,460 | 2.33 | 19,256 | 4.59 | | - Thermal | 106,072 | 17.10 | 136,984 | 32.66 | | Purchase of Electricity | 155,686 | 25.10 | 78,397 | 18.69 | | Transmission | 16,185 | 2.61 | 15,705 | 3.74 | | Central Services | 43,582 | 7.03 | 34,801 | 8.30 | | Akosombo/Akuse Township | 3,952 | 0.64 | 8,219 | 1.96 | | Health Services | 6,847 | 1.10 | 7,605 | 1.81 | | Distribution | 10,267 | 1.66 | 7,988 | 1.90 | | | ----------- | ----------- | ----------- | ----------- | | Operating Expenses | 357,051 | 57.56 | 308,955 | 73.65 | | Depreciation | 192,880 | 31.10 | 106,330 | 25.35 | | | ----------- | ----------- | ----------- | ----------- | | Total Operating Expenses | 549,931 | 88.66 | 415,285 | 99.00 | | Loan Interest | 40,591 | 6.54 | 19,170 | 4.57 | | Exceptional Item | 84,254 | 13.58 | 75,816 | 18.07 | | Exchange Fluctuation | 237,565 | 38.30 | 28,872 | 6.88 | | | ----------- | ----------- | ----------- | ----------- | | Total Expenses | 915,341 | 147.08 | 539,143 | 128.53 | | Net Operating Loss | (283,207) | (45.66) | (105,160) | (25.07) | | Other Revenue | (8,851) | (1.43) | (14,516) | (3.46) | | | ------------ | ------------ | ------------ | ------------ | | Power Sales | 620,283 | 100.00 | 419,467 | 100.00 | | | ======= | ======= | ======= | ======= |
|
|
|
|
| | | | |
| |
|
