The Ivorian government has issued a warning notice to cut off power to Liberia if the government fails to settle its substantial debt of US$19.6 million.
The warning was issued through the Compagnie Ivoirienne d’Électricité (CIE), the country’s electricity provider.
In a letter to the Liberia Electricity Corporation (LEC), CIE notified the management of LEC that Liberia’s outstanding debt has reached over US$19.6 million as of the end of June 2024.
The Ivorian electricity sector, currently grappling with financial difficulties due to rising generation costs, has declared the debt unsustainable.
“We are writing to alert you to the situation of your institution in our books. To date, your outstanding bills amount to USD nineteen million six hundred and ninety-one thousand six hundred and forty-seven (19,691,647) as of the end of June 2024.”
The Liberian Government is expected to pay for MV: USD eleven million nine thousand six hundred and fourteen (11,009,614); HV: USD eight million six hundred and eighty-two thousand thirty-three (8,682,033).
The letter is quoted as saying that this level of unpaid bills represents an unsustainable burden for the Ivorian electricity sector, which is currently experiencing financial difficulties exacerbated by the increase in electricity generation costs.
CIE, in its communication, highlighted that during their last collection visit in February 2024, the LEC promised a new clearance plan aimed at reducing the level of unpaid MV bills.
“Furthermore, please note that during our last collection visit in February 2024, you informed us of a new clearance plan with a view to reducing the level of unpaid MV bills.” According to CIE, Liberia has defaulted on the payment plan agreed upon during their last collection visit in February. “To date, this plan has not been complied with, as no payment has been made since the start of the period covered by the plan.”
The Ivorian Electricity Cooperation emphasized that if Liberia does not respond through payment within the next fifteen days, they will have no option but to implement Articles 11.4 and 21.3 of the Power Sale Agreement.
“Please note that, in the absence of a response from you within fifteen (15) days regarding the above-mentioned situations, we shall have no other choice but to implement the provisions of Articles 11.4 and 21.3 of the Power Sale Agreement, relating respectively to the suspension of power supply and termination in the event of default by the purchaser.”
Confirming this financial liability, the Liberia Electricity Corporation (LEC) has written to the Ministry of Finance and Development Planning seeking urgent assistance to settle Ivory Coast’s outstanding debt of US$19.6 million in electricity bills.
The LEC communication, dated September 3, 2024, pleads with the MFDP to immediately intervene regarding energy payment to Côte d’Ivoire.
“I am pleased to present my compliments and to inform you of an urgent matter requiring immediate action concerning energy payments to Côte d’Ivoire,” LEC CEO Monie Captan stated in a letter to Acting Minister of Finance Anthony Myers.
Captan highlighted in his communication that they have received notice from CIE that cross-border supply of electricity through the CLSG will be suspended within 15 days. “As you will note, the 2024 National Budget allocated the amount of $3 million for payment against energy debt to CIE of Côte d’Ivoire, with monthly installments of $228,263.20, which was based on a rescheduling of our cross-border debt upon the intervention of President Boakai during his official visit to Abidjan in March 2024,” Captan stated. The LEC communication is quoted as saying that since the passage of the budget, they have made all attempts to obtain disbursement of the installment payments without any success.
The LEC boss disclosed that the government’s accrued debt to LEC for energy supplied now stands at US$16 million, placing LEC in a dire financial situation. “We requested payment from the Ministry of Finance and Development Planning on June 3, 2024, in LEC letter reference LEC-CEO/041/24 in the amount of $1,141,316, covering installments for January to May 2024; an allotment was prepared for this request in August 2024 with no disbursement. Due to the current urgency and notice of suspension of service, I am requesting that the current allocation be upgraded to cover the installment payments for the months of January to September 2024 in the amount of $2,054,368.80 and disbursed before the 15-day suspension notice deadline,” the communication emphasized.
Captan further informed the MFDP of its current CIE energy bills, which have also accrued to $11,009,614, which LEC is expected to pay.
With government indebtedness in the amount of $16 million, the LEC is requesting some partial payment against government indebtedness that will allow the LEC to make some payments against the current energy bill.
“I have attached copies of 1) LEC letter of June 3, 2024, 2) CIE Notice of Suspension, and 3) Cross-Border Installment Payment Plan,” the LEC communication revealed.
