Regulatory and policy options to encourage development of ...

MODULE 9: RENEWABLE ENERGY: REGULATORY AND POLICY OPTIONSpage 9.831. BACKGROUND1.1. Energy generationGhana’s first major generation project was the Akosombo hydroelectric dam, commissionedin 1965 with an initial output of 588 MW. Prior to this, several smalldiesel plants were in operation, providing services to local communities, mines,industries, hospitals and educational institutions around the country. Thesesmaller and more expensive plants were phased out as cheap electricity graduallybecame available through the national grid. Power output from Akosombowas increased to 912 MW in 1972; followed in 1982 by the addition of 160 MWfrom a second hydroelectric plant located at Kpong, downstream from Akosombo.In 1998, poor rainfall in the catchment area of the Akosombo dam led to sharplyreduced output from the plant, and two foreign companies, Cummins Ltd. andAggrekko Ltd. were contracted to run two 30 MW diesel power plants to feedpower directly into the national grid. These plants were classified as “EmergencyPower Producers” and were eventually shut down in 2000 when the electricitysupplied by Volta River Authority (VRA) increased to normal levels. However, a30 MW diesel plant, commissioned in 1992, is run by VRA in Tema.Further expansion took place in 1999 with the completion of a 330 MW-combinedCycle Thermal Plant at Aboadze in south-western Ghana. Output at the Aboadzeplant was increased in 2000 with the addition of a 220 MW simple cycle thermalgenerator using waste heat from the original turbines. The expanded plant isjointly owned by the Volta River Authority and CMS Energy of Michigan, USA. In2000, the Government purchased a 125 MW power barge to generate electricityfrom natural gas from the Tano fields but this is yet to be commissioned. Table 1shows the installed capacity of electricity generating plants in the country in 2005.Table 1. Installed capacity of generating plants (2005)Generation plants Type of plant Fuel Capacity (MW)1. Akosombo Hydro Hydro 1,0382. Kpong Hydro Hydro 1603. Takoradi thermal plant Thermal LCO/gas 3304. TICO (CMS/VRA Thermal LCO/gas 220plant at Takoradi)5. Tema diesel plant Thermal Diesel 30Ghana’s electricity grid is interconnected with those of the neighbouring countriesof Benin, Burkina Faso, Côte d’Ivoire and Togo. Before 1995, Ghana had a surplus