REGULAR droughts over the past 30 years have caused prolonged power shortages in the west African nation of Ghana. The country has traditionally relied heavily on hydroelectricity from the Akosombo dam but it was felt that additional generating capacity was required to cope with growing industrial capacity and economic growth. The West African Gas Pipeline (WAGP) finally came onstream at the start of this year, bringing much needed feedstock to coastal thermal power plants, yet the Government has surprised many by opting for a massive new hydro scheme.
Following independence in 1957, it was hoped that the giant Volta River Project, encompassing the Akosombo and Kpong dams, would provide the power to industrialise Ghana. Although persistent economic and political instability dashed the dreams of rapid economic growth, the six turbines of the 1,020MW (uprated from 912MW) Akosombo scheme and the four turbines of its 160MW Kpong counterpart have provided the lion’s share of electricity consumed in the country since they were installed in the 1960s and 1970s.
Akosombo is a huge project and one of the largest hydro schemes in Africa. However, population growth and mining sector investment in Ghana increased demand for electricity in the 1970s and 1980s, so the two state owned power companies – the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG) were no longer able to rely on Akosombo to satisfy demand during droughts.
The drought and accompanying power shortages of 1998-99 finally forced the Government to seriously investigate the development of additional power generating capacity. Given the impact of fluctuating rainfall on the performance of hydro schemes in the region, it was widely expected that any new power plants would be thermal. Ghana’s own offshore acreage was explored for likely sources of gas but insufficient reserves were identified. Ivory Coast provided another possible option but civil war in that previously stable country halted negotiations.
In the meantime, progress was gradually made on turning the WAGP into a reality. The scheme to build a pipeline parallel to the West African coast to pipe gas from Nigeria to Benin, Togo and principally Ghana had been planned since the 1990s but coordinating the involvement of four governments, four very different jurisdictions and the participation of numerous investors held up progress. Nevertheless, a sustained pledge by the Nigerian Government to outlaw routine gas flaring by 2008 forced the international oil companies that dominate the Nigerian oil and gas sector to find a commercial outlet for previously flared associated gas.
The result on was the construction of the WAGP by a consortium of ChevronTexaco West African Gas Pipeline Ltd (36.7%), the Nigerian National Petroleum Corporation (NNPC) (25%), Shell Overseas Holdings Ltd (18%), Ghana’s VRA (16.3%), Société Beninoise de Gaz S.A. (2%) and Société Togolaise de Gaz S.A. (2%). The first gas flowed to Ghana in January this year and will supply feedstock to VRA’s 330MW combined cycle thermal plant at Aboadze near Takoradi, which has now been converted from oil to gas. The 220MW Takoradi International Company (TICO) simple cycle plant at the same site has been expanded to a 330MW combined cycle facility to run on WAGP gas.
Other thermal power projects have also been considered and it was expected that gas-fired capacity would be targeted to enable the Government to achieve its target of increasing national generating capacity from 1,700MW to 3,000MW by 2012. However, Accra has now decided that the biggest single contribution to new capacity will come from the hydro sector. The Government, of President John Kufuor, has decided that some new thermal capacity is required to provide balance in the generation mix, but has also concluded that the impact of drought has revealed that more hydro capacity is required to maintain supplies. The Ministry of Energy insists that it should be possible to maintain reservoir levels and substantial hydroelectric production even during prolonged droughts.
China funds for Bui
The centrepiece of this renaissance for Ghanaian hydro is the Bui project in Brong Ahafo region. The scheme was first planned in the 1970s and a feasibility study on the venture, which was carried out by French consulting engineer coyne-et-bellier on behalf of the Government of Ghana, in 1995, concluded that it was economically viable. However, it was not until the Chinese state-owned firm Sino Hydro signed a memorandum of understanding (MOU) with the Government of Ghana to develop the venture under a build and operate transfer (BOT) contract that substantial progress was finally made. The required environmental impact assessment was completed in 2006 and the Chinese firm, which was formerly called the China National Water Resources and Hydropower Corporation, signed the engineering, procurement and construction (EPC) contract in April 2007.
The 400MW project will be located in Bui National Park on the Black Volta river, otherwise known as the Mouhoun, which flows into Ghana from Ivory Coast. The Black Volta flows into Lake Volta and so the new Bui reservoir could also be used to hold water for Akosombo. A 110m-high roller compacted concrete (RCC) dam and three turbines will be developed at an estimated cost of US$622M, up from last year’s estimate of US$594M.
It was always assumed that Chinese state agencies would provide most of the project finance and in September 2007 the funding package was agreed. The Government of Ghana will contribute US$60M, while the Chinese government has agreed to provide a low interest loan of US$270M and the Export-Import Bank of China (Exim Bank) has agreed to supply the remaining US$292M in the form of a buyer’s credit facility. Sino Hydro plans to bring the project on stream by 2012. The additional hydroelectric generating capacity will be badly needed. While the coastal thermal plants are ideally placed to supply electricity to the capital Accra and the more developed south of the country, demand inland is rising because of the country’s booming mining sector.
The Ministry of Energy has highlighted several reasons for its desire to retain the overall focus on hydro in the generation mix by developing Bui, including the scheme’s ability to minimise Ghana’s dependence on the purchase of imported fuel. Secondly, it should help to stabilise the load flow in the power system, especially in the northern part of the power grid, while also reducing transmission losses in the north which currently receives all of its electricity from near the coast. This, in turn, should help to spread the more rapid economic development that has recently been achieved in the south to the rest of the country.
Apart from power generation, the reservoir will also provide irrigation water for Brong Ahafo region. About 3,000 jobs will be created during the construction phase, while a new town, Bui City, will be created on the edge of the reservoir to act as a tourist centre. The Government hopes that this will generate more indirect employment in the longer term. The Ministry also expects Bui to improve the technical capacity of Ghana to supply power to our neighbours in Burkina Faso and Northern Togo. Finally, a Ministry spokesperson said that the development of Bui will reduce the high operation cost of thermal generation by making use of a renewable source of energy.
Public consultation
Environmental aspects of the impact of the project have aroused some opposition. About 2,000 people will be forced to leave their homes and land, although this is a relatively small number given the scale of the endeavour. Most negative criticism, however, is directed at the impact on Bui National Park, and particularly on the plight of the 140 rare black hippopotamuses that live in the part of the national park that will be submerged. Independent naturalists working in the area have concluded that the hippos will be forced to migrate to areas where they will come into conflict with farmers.
The Government has made some attempt to appease opposition to the scheme. At the second Ghana Dams Forum and Workshop, the Minister of Fisheries, Gladys Asmah, commented: ‘If we have nothing to guide us at all, the Akosombo and Kpong dams are enough to make Ghanaians masters in this field. The issues of dams must never be taken lightly due to their multifaceted and mixed effects.’
The meeting, which was sponsored by the Deutsche Gesellschaft für Technische Zusammenarbeit, was held in Accra at the end of February this year and sought to bring all interested parties together to discuss the impact of the dam and flooding. Asmah promised that the Government would work alongside a variety of agencies to mitigate the negative environmental, social and ecological impact of the dam.
Richard Twum-Barimah Koranteng, the executive director of the Volta Basin Development Foundation, commented: ‘It is absolutely true that dams have made an important and significant contribution to human development, and the benefits derived from them have been considerable. However, in too many cases an unacceptable and often unnecessary price has been paid to secure those benefits, especially in social and environmental terms by people displaced, by communities downstream, by taxpayers and by the natural environment. Therefore, by bringing to the table all those whose rights are involved and who bear the risks associated with different options for water and energy resource development, the conditions for a positive resolution of competing interests and conflicts are created.’
Koranteng added that the current environmental and social impact assessment does not include enough scientific data on the potential impact of climate change on the Bui scheme. He said that the Government needs to consider a variety of likely scenarios if regional rainfall patterns become increasingly erratic. The forum and workshop was part of the National Dialogue on Dams and Development, which was launched in 2006 and which aims at strengthening institutional structures and processes and to holistically discuss and assess the need for dams in order to respond to water and energy needs. Accra has promised that, unlike with the Volta River Scheme, adequate compensation will be paid to those displaced. Given that relatively few people are involved this time around, this promise should be easier to fulfil.
Accra hopes that the completion of Bui will enable it to resume its position as a major power exporter in West Africa. Until the 1990s, Ghana had a sizeable power production surplus and was able to sell electricity to neighbouring Ivory Coast. However, the direction of supply has switched in recent years, as the VRA and ECG have struggled to meet domestic demand. From February 2007, Ghana was even forced to sign an agreement to import electricity from power-poor Nigeria and allow the Power Holding Company of Nigeria (PHCN) to take over responsibility for supplying Togo and Benin. The two small nations lie between Nigeria and Ghana and have traditionally relied on imports from Ghana. Spur pipelines from the WAGP could provide gas feedstock for local thermal power plants but in practice imports are likely to continue.
The Bui scheme would be ideally placed for export, as it is located close to the border with Ivory Coast, where investment in new power generating capacity is likely to be less forthcoming because of that country’s still unresolved security problems. Ghana’s export potential would undoubtedly be boosted by more rapid progress on the West African Power Pool (WAPP). The first phase of the pool’s development should see transmission infrastructure developed to enable the country to export significant electricity supplies to Benin, Burkina Faso, Ivory Coast, Niger, Nigeria and Togo, but it remains to be seen whether the political will exists within the Economic Community of West African States (ECOWAS) to put the required interconnectors and regulatory changes in place.
While Bui and new thermal power plants should help the Government to attain its goal of securing 3,000MW of generating capacity at some stage over the next decade, a string of smaller hydro schemes, including the Ankobra, Pra, Tano and White Volta projects, is being considered by the Government. There may also be some capacity to boost output on the Kpong scheme. At present, there is a rise in tailwater elevation that limits generation on Kpong to 148MW, but the government has suggested that the plant capacity could be doubled to 320MW in future. In the short term, tackling the growing menace of aquatic weeds in the Lower Volta Basin could boost output. The Government and the African Development Bank (ADB) have provided US$2.5M to clear the vegetation, which also provides a breeding ground for bilharzia, a parasitic infection caused by waterborne flatworms.
Outlook
China’s decision to offer US$562M in credit on easy terms looks likely to be replicated elsewhere in Africa, providing funding for hydro schemes elsewhere on the continent. Although the IMF and other multilaterals have concerns about some of the poorest countries in the world taking on substantial debts just when real progress is finally being made on debt cancellation, there is unlikely to be any shortage of takers for Chinese finance. Ethiopia, Zambia and Guinea are all currently benefiting from Chinese investment in major dam projects.
The Ghanaian Government now hopes to inculcate a culture of long-term power sector planning. Rather than waiting for power shortages or the impact of climate change to become apparent, it hopes to ensure that sufficient generating capacity is brought on stream ahead of schedule. To look ahead to the next 30 years and forestall the current energy shortage problems, and in anticipation of increased population and widespread industrialisation, the Government aims to plan ahead for increased energy supply will become part of the national culture.
However, if Ghana is to make the most of its new hydro capacity, it is vital that both national transmission and distribution infrastructure and cross-border interconnectors are upgraded to enable the efficient transmission of electricity. At present, power shortages are not only the result of insufficient power production and climatic variations but also derive from limited transmission capacity between regions. Hydro schemes can make a major contribution to tackling the power shortages that afflict most African countries, but they need to be developed in conjunction with wider power sector investment.
TablesTable 1: The Akosombo Dam Table 2: Akosombo Dam – technical data
