Cenpower trades $66m of arrears for a longer Ghana power contract

Cenpower Generation has agreed to reduce outstanding government arrears by $66m under an amended power purchase agreement with Ghana, in return for a ten-year extension and a lower electricity tariff. The revised terms affect the economics of the 375MW Kpone Thermal Power Plant and form part of the government’s efforts to address legacy obligations to independent power producers.

Ghana’s accumulated power-sector debt to Cenpower had reached approximately $400m before the independent power producer agreed to write off $66m under revised contractual terms announced on 4 November.

The amended and restated power purchase agreement (PPA) with the Electricity Company of Ghana also provides Cenpower with a ten-year extension to its existing contract and includes a reduction in the tariff charged for electricity supplied to the state-owned offtaker.

The agreement was announced at a ceremony marking ten years of operations at Cenpower’s 375MW Kpone Thermal Power Plant in the Tema industrial area.

Samuel Nana Brew-Butler, Cenpower’s board chairman, said the company had accepted the reduction as a contribution towards resolving the country’s outstanding obligations.

The government’s arrears to independent power producers have been a longstanding issue for Ghana’s electricity sector, with delayed payments placing pressure on generators and the wider financial position of the power market.

Approximately $59m had already been paid to Cenpower in 2025 as part of the government’s programme to settle legacy debts owed to independent power producers.

Under the revised agreement, the $66m concession reduces the amount outstanding, while the longer contract gives Cenpower an extended period under which it can supply electricity to the national offtaker. The tariff reduction also changes the price at which that electricity is purchased.

The precise revised tariff, the remaining balance of the government’s obligations to Cenpower and the new expiry date of the agreement were not disclosed in the reporting available.

The agreement therefore represents a negotiated adjustment to the relationship between the government and one of its major private power suppliers, with the longer contract providing a new basis for their commercial arrangement.

Images: Cenpower Generation