The Renewable Energy (Amendment) Bill, 2020 Read the Third Time and Passed.
07-11-2020Parliament on Friday adopted the recommendation of the Mines and Energy Committee and passed into law, under a Certificate of Urgency, the Renewable Energy (Amendment) Bill, 2020 to enable the utilities in the power generation sector secure power at competitive tariffs to ensure cheaper end-user tariff for consumers and the promotion of small businesses.
The Bill was laid in the House on Friday, 30th October, 2020 by the Hon. Deputy Minister for Energy and the Member of Parliament (MP) for Effia Constituency in Western Region Joseph Cudjoe on behalf of the Hon. Minster John Peter Amewu pursuant to Article 106 (4) of the 1992 Constitution.
The Right Honourable Speaker Professor Aaron Michael Oquaye subsequently referred the Bill to the Select Committee on Mines and Energy for consideration and report in accordance with Article 106 (4) of the Constitution and Order 118 of the Standing Orders of House the Standing.
The Government of Ghana in 2011, enacted the Renewable Energy Act , 2011 (Act 832) to provide an enabling environment and foster the development of the renewable resources of the country, which provided a regulatory licensing regime and imposed an obligation on utilities and bulk customers to purchase part of their electricity requirements from renewable resources.
The Act also established a feed-in-tariff scheme to ensure that investors in the renewable energy sector obtain good rate of return in recognition of the high cost of renewable energy technologies and the resultant high unit cost of electricity particularly those from solar photovoltaic (PV) systems.
However rapid technological development has resulted in a steep reduction in the prices of technology to the extent that in some countries, electricity from photovoltaic systems are at grid parity or in some cases even cheaper than fossil fuel-based power generation following the enactment of the Act in 2011.
The current pace of reduction the price of renewable systems and the resultant cost of electricity from renewable energy sources has rendered the feed-in-tariff regime a burden on consumers who have to pay for expensive solar photovoltaic power based on feed-in-tariff, while the solar photovoltaic could be secured at a cheaper cost through competitive biding.
It has therefore become imperative that the existing Renewable Energy Act 2011 (Act 832) be amended to enable consumers of electricity in Ghana to benefit from the reduced cost of electricity generation from renewable energy sources through competitive procurement instead of the feed-in-tariff scheme.
The purpose of the Bill is therefore both amend Act 832 to establish a competitive procurement scheme and a net-metering scheme in respect of electricity generated from renewable energy source and empower the Energy Minister to designate a public entity to perform specific functions in the area of renewable energy and other clean energy initiatives.
The Chairman of the Mines and Energy Committee Emmanuel Akwasi Gyamfi presenting the Committee’s report said the competitive procurement regime which the Bill seeks to introduce will attract a competitive market rate for electricity generated from renewable energy sources and prevent negotiation between wholesale suppliers and distribution utilities which usually leads to procurement of expensive power in the country.
The Deputy Minister disclosed that the Bill urged the distribution utilities to procure electricity from consumer-generators to encourage small-scale self-generation through metering and further mandated fossil fuel-based wholesale electricity suppliers, fossil fuel producers and other companies that contribute to greenhouse gas emissions to invest in non-utility scale renewable energy technologies.
He assured the House that the passage of the Bill will therefore promote renewable energy and reduce the burden of high tariffs on consumers that are emerging as a result of utility scale photovoltaic plants charging high feed-in-tariff and also ensure that utilities complement efforts of the State at the global level in mitigating climate change.
