Ghana Power Compact

Through our $308 million compact, MCC is helping the Government of Ghana improve the power sector through investments that will provide more reliable and affordable electricity to Ghana’s businesses and households. The United States is among Ghana’s principal trading partners, with bilateral trade between the two countries reaching $1.2 billion in 2015. While Ghana has experienced strong economic growth over the past 10 years, the power sector has not kept up with increasing demand from businesses and consumers, holding back Ghana’s potential for private investment.

The original amount at compact signing in 2014 was $498 million, however the compact was reduced by $190 million in October 2019.

Financials

Financials as of March 31, 2021

Compact Budget

Milestones

  • Signed:
    August 6, 2014
  • Entry Into Force:
    September 6, 2016

Compact Projects

Access Project

  • $900,000Project Total Amount
  • $899,311Project Amount Committed
  • $570,539Project Amount Expended

The Access Project will facilitate safe and legal access to reliable electricity in markets and economic enclaves in urban areas. Key interventions are the replacement of electrical distribution systems in market areas, the provision of security lighting, and a facilitation and capacity building process aimed at formalizing connections.

Projected Long-Term Results

Electricity Company of Ghana Financial and Operational Turnaround Project

  • $213,205,212Project Total Amount
  • $193,223,109Project Amount Committed
  • $132,519,893Project Amount Expended

MCC is supporting the Government of Ghana’s efforts to improve the efficiency of Ghana’s largest state-owned electricity distribution utility by investing in distribution infrastructure and making investments in systems at the corporate level to improve overall service quality. The project includes targeted regional infrastructure investments to support integrated power loss management, reduce distribution system vulnerability to theft and meter manipulation, lower thermal losses in the distribution systems, and reduce the frequency and duration of outages.

Projected Long-Term Results

  • Estimated Beneficiaries 4,800,000
  • Estimated Net Benefits $143,300,000

Energy Efficiency and Demand Side Management Project

  • $22,297,799Project Total Amount
  • $20,221,909Project Amount Committed
  • $13,939,449Project Amount Expended

MCC is supporting the Government of Ghana in offsetting demand for electricity by developing new or improved efficiency standards for appliances, supporting education in energy efficiency, investing in more efficient Government buildings, and exploring demand side management measures, like converting streetlights to more efficient LED technology.

Projected Long-Term Results

  • Estimated Beneficiaries 19,600,000
  • Estimated Net Benefits $95,800,000

Northern Electric Distribution Company Financial and Operational Turnaround Project

  • $1,175,475Project Total Amount
  • $1,175,475Project Amount Committed
  • $1,175,475Project Amount Expended

MCC intended to support the Government of Ghana’s priority efforts to improve the management and service delivery capacity of the Northern Electric Distribution Company (NEDCo), the state-owned electricity utility serving the northern regions of Ghana. This project was designed to support these efforts by providing infrastructure investments and support for capacity building within the utility.

The planned intervention to achieve this objective was to introduce Private Sector Participation (PSP) in the form of a management contract. As the PSP did not proceed, the project was ultimately cancelled although funding was spent for design of some infrastructure activities before it was cancelled.

Projected Long-Term Results

Power Generation Sector Improvement Project

  • $0Project Total Amount
  • $0Project Amount Committed
  • $0Project Amount Expended

The Power Generation Sector Improvement Project was intended to support measures aimed at opening up the power sector and making it attractive to private investment in order to reach the Government of Ghana’s goals to have adequate installed generation capacity to meet demand. After rationalizing the project with other donor programs and existing commercial arrangements, the project was cancelled to reduce redundancy and unnecessary expense.

Projected Long-Term Results

Regulatory Strengthening and Capacity Building Project

  • $2,874,095Project Total Amount
  • $2,538,650Project Amount Committed
  • $2,288,650Project Amount Expended

MCC is working with the Government of Ghana to ensure that Ghana’s electricity sector regulators, the Energy Commission and the Public Utilities Regulatory Commission, have the resources and capacity they need to ensure that power services are reliable, affordable and high quality. This project includes support for key tariff studies, technical assistance and capacity building.

Projected Long-Term Results

As of May 12, 2021