Home Business ECG paid more than GH¢182m to Cenit Energy in 2018

ECG paid more than GH¢182m to Cenit Energy in 2018


The Electricity Company of Ghana (ECG) has paid a whopping amount of GH¢182,576,235.15 to Cenit Energy as capacity charges for electricity not supplied for 12 months in 2018.

However, Cenit supplied only 300.00kWh and 2,220,900.00kWh in August and December respectively for the full year.

According to the 2020 Auditor-General’s Report, ECG also lost 2,649.08 GWh, which represented 24.30% of the power purchased from the power-producing companies to system losses.

The report advised the company’s Management to determine losses that are due to technical and commercial challenges to enable ECG to deploy measures to reduce those losses.

It also advised Management to ensure that exit clauses are considered extensively before signing contracts.

The Auditor-General’s report noted that during the audit, ECG has not established an Audit Committee, but the Board Sub-committee on Finance performed oversight responsibilities of the Audit Committee function.

It, however, advised Management to establish an Audit Committee per the Public Financial Management Act, 2016 (Act 921).

The report noted that Management procured prepayment meters and 265sq meters of conductors amounting to GH¢59,161,964.56 between 2014 and 2016. Those items were not issued till the time of their inspection on August 8, 2019.

“We recommended to Management to ensure that the prepayment meters and conductors are issued out to the users failing which the amount involved should be recovered from the officers who engaged in the procurement,” the report said.

The Auditor-General’s report also disclosed that electrical materials amounting to GH¢11,581,019.21 were given out on loan to eight beneficiary Companies.

Those materials were issued out between 2014 and 2018 without any specific terms of the agreement.

It advised Management to pursue the returns of those electrical supplies or the parties concerned should be made to pay for the cost of the materials as considered appropriate before the materials become obsolete.

“We noted during our audit that 17 transformers were damaged within 2010 and 2013 but they are unable to ascertain the basis upon which the transformers with an average useful life of 35 years can
be damaged without use,” it added.

The report recommended to ECG’s Management to safeguard assets procured and ensure that the faulty transformers were repaired or the Procurement Officers and Operations Directorate should be held responsible for the damage to the equipment.

The report noted that during the review of the company’s store summary, a total amount of GH¢3,214,526.18 and GH¢1,746,094.89 were classified as stock surplus and shortage respectively.

It called on the ECG Management to strengthen supervision to safeguard assets and urged Management to expedite action to produce the Committee’s report for review.

The report indicated that the value of materials transferred from the stores of the Accra West Region to the dedicated or rechargeable jobs was higher than ECG estimates made to customers.

As a result, ECG made losses amounting to GH¢179,647.23 for materials provided on rechargeable jobs.

Thus, the Auditor-General has advised the ECG Management to ensure that the engineer’s estimate should be on materials only, whilst the accounts section does the costing of the materials to avoid recurrence of the loss of materials for dedicated jobs.

The Audit Report noted that during the audit, 16 Special Load Tariff Companies in the Region had not paid their debts amounting to GH¢27,857,498.59.

It, therefore, directed the company’s Management to expedite action on the legal proceedings to recover the debt and urged it also to ensure that the Companies do not reconnect the meters secretly.

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