as $190 Million MCC Loss Haunts Power Sector
By Prince Ahenkorah
Four years after Ghana terminated the troubled Power Distribution Services concession, the Bureau of National Investigations has made its first high‑profile move.
Philip Ayensu, former board chair of PDS, along with three others; Viraj Phat, Sophia Korkor, and Justice Menka‑Premoh were arrested last week over alleged financial irregularities involving funds belonging to the Electricity Company of Ghana.
All four have been granted bail pending further investigation, presidential spokesperson Felix Ofosu Kwakye confirmed. The BNI has not disclosed the amount of money suspected to have been improperly transferred, nor has it filed formal charges.
The arrests, part of ongoing ORAL case reviews, reopen a scandal that cost Ghana $190 million in frozen Millennium Challenge Corporation funding — and exposed deep vulnerabilities in the due diligence of major state contracts.
The Deal That Unraveled
In March 2019, Ghana signed a 25‑year concession transferring a large portion of ECG’s electricity distribution network to PDS. The agreement was a cornerstone of the MCC’s $498 million Power Compact, designed to reform the country’s loss‑making power utility.
By July 2019, the government suspended the deal. The reason: PDS had submitted invalid financial guarantees. Subsequent investigations revealed that guarantees purportedly issued by Al Koot Insurance and Reinsurance of Qatar were forged.
Qatari courts, including the Court of Cassation, later confirmed the documents were unauthorized. The concession was terminated in October 2019. Management of ECG reverted to the state.
The Financial Wreckage
The collapse triggered immediate and lasting damage:
· $190 million — The amount of MCC funding withdrawn. The U.S. government had made private sector participation through PDS a non‑negotiable condition of the compact. Once the deal fell apart, the final tranche of funds was halted.
· $390 million The claim PDS later filed against ECG in London arbitration, seeking $39.4 million in direct costs and $351.5 million in lost profits. A tribunal rejected the claim in full, vindicating the government’s termination.
· $1.5 billion Total debts owed by Ghana’s power sector to independent power producers, according to expert estimates.
· $43 million ECG’s renegotiated monthly payment obligation to IPPs, which the utility continues to struggle to meet, the Public Utilities Regulatory Commission has warned.
ECG was represented in the London arbitration by Omnia Strategy LLP, led by Cherie Blair KC. The tribunal’s ruling confirmed what critics had long argued: the PDS transaction was marred by fraudulent guarantees and weak due diligence.
Yet no senior political figure has faced accountability. The Akufo‑Addo administration, which had heralded the concession as a bold privatization move, faced intense scrutiny from opposition parties and civil society over alleged negligence and complicity.
The BNI’s new arrests of the board chair and three others suggest a shift toward individual liability, but the probe remains pending.
The energy sector’s deeper crisis continues. IPPs are owed over $1.5 billion. ECG’s liquidity shortfall shows no sign of abating. And the $190 million in lost MCC funding was meant for critical grid upgrades investments Ghana now must fund itself, or forgo entirely.
For now, the four arrestees are out on bail. The BNI has given no timeline for charges. And the question that has haunted the PDS affair from the start how forged guarantees passed muster at the highest levels of government remains unanswered.