have the sun which shines an average of twelve hours in a day. In the eastern side of our coast, the wind has the potential to support the generation of energy. Other areas like wood fuel, bio-mass and the rest are also there for us to tap into.
The problem - Why maybe, as a nation, we have not taken advantage of these sources is that we do not have the legal framework that will create the needed and enabling environment for investors to venture into this area.
Mr Speaker, I recall in the 2007 and 2008 period when we went through the energy crisis - globally and Ghana not exempted - many were investors who wanted to take advantage of that but because we lacked that legal framework, their efforts were thwarted. It is, therefore, a welcome news that this Bill is coming and if adopted, it will definitely create that environment, a legal framework for investors to venture into that area.
Mr Speaker, the Bill makes provision for the Energy Commission to collaborate with our institutions in the development of curriculum and I am happy to mention that as far back as 2007, the Tamale Polytechnic and the Kwame Nkrumah University of Science and Technology (KNUST) were supported by Japan International Co-operation Agency (IICA) to undertake this venture.
Around the same time, a delegation that went to Germany included a team from KNUST, and I am happy to note that the present Vice-Chancellor, Professor Otoo Elvis was in that delegation. That delegation seriously considered how Ghana could take advantage of renewable energy by learning from what was pertaining in Germany.
KNUST has already started a project on bio-mass and I think the Ministry will use that as a springboard to support whichever company or investor that would want to go into this area. These positive sides notwithstanding, it is important to mention that there are critical challenges in the development of renew- able energy,
The first one talks about the initial cost of production. We can be talking about the sun which shines twelve hours but to tap this and generate the needed energy is very, very expensive. This is going to impact on the cost of production of that energy and effectively enter into the tariff if we enter into this area. It is, therefore, important that we consider the Com- mittee's recommendation on sources of funding for the generation of renewable energy seriously.
It is important that maybe, the Govern- ment finds other areas to complement and support the already identified sources of funding for this Fund that the Bill anticipates to be established.
The second one deals with the production of bio-fuel. This is going to compete with the lands that we already have and we need to take a very serious note of that. I am happy that in the Bill, there is that collaborative status for the Energy Commission and other Ministries to seriously look at which areas that it can venture into in the bio-fuel pro- duction such that it will not affect the agricultural sector of this country.
On that short note, I wish to urge Hon Members to support this Report and accept the contents thereof.
Deputy Minister for Energy (Alhaji Inusah A. B. Fuseini) (MP): Mr Speaker, I Wish to associate myself with the sentiments raised by the Chairman in their Report and the Hon Member who just spoke.
Indeed, the piloting of this Bill could not have come at a better time. All round the World, countries are harnessing the potential of renewable energy for the purposes of developing their power sources.
For us in Ghana, there is a policy direction to ensure that renewable energy contributes about 10 per cent to the energy generation mix of this country. This means, if we are targeting 5,000 installed capacity by 2020, renewable energy must contribute about 500 megawatts to the installed capacity of this country.
We are doing so because we believe that Ghana abounds in renewable energy sources. We are around the tropics and the sunshine is available throughout the year. Properly harnessed, solar energy could augment the shortfall in the installed capacity that we are experiencing now.
We have also identified some wind sites which can encourage the esta- blishment of windmills for the purposes of generating renewable energy. Again, that source could provide clean available energy for use in our homes, industries and for commercial purposes.
Bio-mass is available. Presently, we are contemplating on how to deal with waste, solid and liquid waste. It is really a problem. People all over the places and in communities have identified the hazards and menace associated with dumping. Presently, all that we are doing is to dump our waste with its consequent environmental hazards. Renewable' energy is targeted at dealing with this
environmental challenge in ensuring that we use our waste in ways that will be beneficial, that will produce more energy to feed our industries, homes and for other purposes.
The challenge, as properly identified, is that the installed cost of renewable energy is too high that it serves as a disincentive to anybody who wants to invest in that sector. Nobody can overlook the tremendous benefits that will accrue to this country by the harnessing of these available resources all over the place. This is why we think that first of all, a legal regime must be created that will help monitor, maintain and operate the law in such a way that it will give comfort to people who want to come and invest in renewable energy. That is also why this Bill contains the feed-in tariffs.
Discussions are ongoing on how to calculate the feed-in tariffs. Is it that persons who have invested in the generation of thermal plants will contribute some percentage of their money because renewable energy could help us control global warming? Will it be that these people, residential users, will pay a token, high and above the tariffs that we pay for the purposes of this feed-in tariff? Or is it that we will access carbon credits by reason of the fact that What we will be doing will help to reduce global warming?
This is why we think that it is important that we look at the sources to the Fund - Renewable Energy Fund. This is because it is this Fund that will augment whatever cost that is associated with the installation of renewable energy technologies in this country.
Let me end by inviting Hon Members of this House to show interest in this Bill, to help enrich the Bill because it is a new area. It is an uncharted territory. We are trying to see how together as a country, we can help harness this potential,