Study reveals licencing expenses as major hurdle for RE businesses

Source The Ghana Report

A survey conducted by the AGI Energy Service Centre has highlighted the cost and fees of licencing among a plethora of factors as the main challenge renewable energy (RE) companies face in their quest to obtain a requisite licence for operation in the country.

While there exist several forms of licencing within the sector, the issue identified in the survey is mainly attributed to companies that hold installation and maintenance licences.

Findings from the survey were announced at a Renewable Energy Licencing Forum in Accra. It brought together the Regulator, Energy Commission and companies being regulated to “validate findings from the survey and see how these two entities can solve some of the challenges they face”.

“Some of the key issues that emerged are around the delays in licencing approvals; also, some spoke about licencing costs and licencing fees. We had issues around local content requirements,” elaborated Dr. Charles Gyamfi Ofori, a consultant to the study.

According to the survey, licencing challenges associated with the country’s RE licencing regime have further impacted the licencing status of some RE businesses – with over 40 percent of them operating without licences.

Of the 28 companies that participated in the survey, 12 of them, representing 43 percent, had no licence; 9 companies –   32 percent, had an active licence; and 25 percent – 7 in number, had expired licences.

In addressing the licencing challenges and achieving the country’s target and goals for decarbonisation, he urged government to streamline RE companies as well as their operations, stressing the need for a “a good licencing regime that it is not inimical to businesses”.

Additionally, he maintained that the sensitive nature of energy as a resource requires that irrespective of a company’s size and form of energy it provides, strict adherence to proper standards must be ensured.

“Energy is a very sensitive resource and we need to ensure that the standards are being followed; so, whether renewable or non-renewable, they need to get the requisite licencing; and it should be done. Whether it’s a one-person business or a two-person business,” he explained.

“I think the first thing is to create a market for businesses to thrive and operate,” he suggested as one of the means to improving renewable energy integration in the country, adding that competition exists in a well-regulated business space and can also drive a lot of important reforms in the renewables space.

Again, Dr. Ofori noted that implementation of the net metering code can encourage more people to integrate renewable energy. It is a billing-related mechanism designed to encourage electricity consumers to supplement their purchase of electricity with grid-connected renewable energy self-generation.

Amid challenges in the space, he commended the Commission for digitalising the process and its plans for initiating more computerised processes in the system; adding that “there is still a lot more room for improvement to ensure some of the delays are majorly curtailed”.

The forum, which brought together representatives of solar companies and the Regulator, provided a platform for industry stakeholders to deliberate on the survey findings, share best practices and discuss potential strategies to streamline the licencing process and promote renewable energy development.

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