News Guide Africa

Tag: ECG

  • Energy sector shortfall persists …IMF warns of ballooning costs amid privatisation option

    Energy sector shortfall persists …IMF warns of ballooning costs amid privatisation option

    Ghana’s energy sector shortfall is projected to balloon to US$1.10 billion in 2026, despite marked improvements, the International Monetary Fund (IMF) has warned.

    During the review period, the shortfall was over US$500 million, as assumed by the government through legacy debt payments or fuel purchases.

    “The smaller budgeted shortfall is justified by the 2025 outturn, as well as the expected reduction in power generation costs from renegotiated PPAs and projected decreased reliance on costly liquid fuels,” the IMF said in its Staff Report on Ghana.

    The IMF projects an energy sector shortfall of US$1.103 billion in 2026, comprising a US$925 million power sector shortfall and US$178 million gas sector shortfall. Revenue to be collected is projected at US$2.607 billion, whilst generation costs are estimated at US$3.53 billion.

    “The government and IPPs have agreed to restructure their legacy debt,” the IMF noted. “In 2025’s Q3, the government agreed with nine IPPs on a comprehensive payment plan for legacy arrears accumulated up to end-June 2025, including substantial haircuts (15 to 30%), significant upfront payments (around $300 million in 2025), and biannual payments for the remainder between 2026 and 2029.”

    The IMF also revealed plans to privatise the Electricity Company of Ghana (ECG), stating that “by the end of 2025, a transaction advisor is expected to be hired to oversee the selection process for private sector concessionaires for electricity distribution.”

    ECG’s payments to independent power producers (IPPs) have increased significantly, reaching $308 million in the first half of 2025, compared with $325 million for 2024 in total. The IMF urged more action to restore ECG to financial sustainability and reduce fiscal risks in the sector.

     

    By Adnan Adams Mohammed

     

     

     

     

     

     

     

     

     

     

  • Postponed WAPCO maintainance to cause load shedding… as US$89mn needed to purchase liquid fuel to run thermal plants

    ECG and GRIDCo logo

     

     

     

    Adnan Adams Mohammed

     

    The West African Gas Pipeline Company Limited (WAPCO) has indicated it will soon undertake planned maintenance termed as ‘pigging’ (cleaning) exercise offshore from January 20 to February Febr 16, 2025.

    WAPCO logo

    Ghana GRID Company Limited in a document titled, “Power Supply Outlook For The WAGP Offshore Pigging From

    January 20 – February 16, 2025 And Projections For 2025 revealed that, the planned maintenance which was initially scheduled to take place in October 2024, but the immediate past NPP government coerced the company to postpone the exercise to this year.

     

    This is expected to affect gas supply to power generation plants, basically in Tema enclaves. It is expected that, there will be deficit in generation capacity during the period of the WAPCO pigging exercise. There is therefore the need to procure liquid fuel to run thermal plants in Tema to meet demand.

     

    “A total of US$ 89.90 million is required to purchase liquid fuel to run thermal plants in order to meet demand for the period”, the GRIDCo document stated. “System demand is projected to grow steadily to an annual peak of 4,415.42MW by the last quarter of 2025.”

     

    It further indicated that, “There will accordingly be the need to secure additional generation resources with dependable capacity of at least 244.66 MW by the last quarter of the year to ensure sustained supply adequacy by the end of the year.”

     

    This is likely to resort in load shedding in days to come.

     

  • ECG’s non-compliance with revised cash waterfall mechanism raises concerns – PURC

    PURC

     

    The Electricity Company of Ghana (ECG) has been found in violation of the revised Cash Waterfall Mechanism (CWM), as reported by the Public Utilities Regulatory Commission (PURC).

     

    The updated CWM, which took effect in August 2023 under President Nana Addo Dankwa Akufo-Addo’s directive, was designed to enhance financial stability in Ghana’s energy sector.

     

    According to the PURC, the revised guidelines mandated ECG to make monthly payments to stakeholders based on a model intended to ensure transparency and fairness in revenue distribution.

     

    However, ECG’s failure to adhere to these standards has raised significant concerns.

     

    “Following the adoption of the revised CWM, ECG was expected to make monthly payments to stakeholders according to the approved model.

     

    “Since the inception of the revised CWM, ECG has not complied with the guidelines as directed by the president, thus undermining the purpose of fair and equitable revenue allocation to sector players,” the PURC stated.

     

     

    The commission criticised ECG for its lack of transparency and consistency in revenue payments, attributing these issues to the worsening financial stability of the sector and declining service quality.

     

    “The lack of transparency and consistency in the payment of collected revenues has burdened the sector with worsening financial sustainability and deteriorating service quality,” the PURC added.

     

     

     

  • Afenyo-Markin appointed new board chairman of ECG.

     

     

     

    Afenyo-Markin as ECG Board Chair

    President Nana Addo Dankwa Akufo-Addo has appointed Alexander Afenyo-Markin, the Majority Leader and Member of Parliament for Effutu, as the new Board Chairman of the Electricity Company of Ghana (ECG).

     

    This appointment was confirmed in a letter signed by the President’s Secretary, Ambassador Nana Asante Bediatuo.

    Afenyo-Markin succeeds Herbert Krapa, who has been appointed as the Minister of State at the Energy Ministry.

    Herbert Krapa had replaced Keli Gadzekpo, who resigned from his position on March 26.

     

     

  • IPPs kick against tariff reduction… says it threatens DDEP efforts 

     

    Adnan Adams Mohammed

     

    The recent 1.52 percent electricity tariffs reduction announced by the Public Utilities Regulatory Commission (PURC) have been rejected by the Independent Power Producers (IPPs).  

     

    The power producers described the reduction as unacceptable, as they believe it will affect the debt restructuring ‘dosage’ the government forced down the throat of the Electricity Company of Ghana which has dire effect on the IPPs.

     

    Apparently, PURC has defended its position on the downward review of utility tariffs, attributing it to a number of factors. It highlighted the downwards trend of inflation and a stable exchange rate as some of the factors that resulted in the 1.52 percent decrease in electricity tariffs effective December 1, 2023. But, the IPPs fears ECG will struggle to pay its debt.

     

    “We are on life support and cannot guarantee continuity. If you give us a haircut, say a 30% or 40% reduction, who is going to pay our debts for us?”, the President of the IPPs, Dr. Elikplim Apetorgbor said. 

     

    “The debt in question is not our savings, it’s not our profit. So it is impossible to restructure it.”

     

    Meanwhile, in defending the reduction, the Director of Research and Corporate Affairs at PURC, Dr. Eric Obutey, said the production of more gas and hydro also pushed the tariff down.

     

    “The downward review was necessitated by four factors: the generation mix, where we now use more hydro compared to thermal. Hydro now accounts for about 31.9%, and thermal is about 68%.”

     

    “We have a downward trend in inflation, which has dipped by about 3.6%, and we also have fuel prices, which have gone down by about 5.9%. So if you put it all together, these factors necessitated the downward trend in electricity prices,” Dr. Eric Obutey explained.

     

    In its 2023 fourth-quarter tariff review, the PURC announced a 0.34% increase in water tariffs and a 1.52% decrease in electricity tariffs to take effect on December 1, 2023.

     

    The water tariff for residential customers increased from GHS/m³ 4.72 to 4.74, while non-residential customers moved from GHS/m³ 14.13 to 14.19.

     

    For water sachet producers, their tariff has been hiked from GHS/m³ 22.26 to 22.34; Industrial consumers will have their tariff moved from GHS/m³ 25.29 to 25.38.

     

  • Ghana tops electricity access in Sub-Saharan Africa – Africa Pulse Report

    Ghana tops electricity access in Sub-Saharan Africa – Africa Pulse Report

    Memuna Asuma

     

    World Bank’s April 2023 Africa Pulse Report has rated Ghana as the first Sub-Saharan Africa with the largest electricity access rate.

     

    The West African nation recorded about 81% access to electricity rate in 2021, beat African power houses including South Africa, Kenya and Nigeria.

     

    In 2015, the country’s access to electricity in Africa stood at about 75%. That still placed it number one on the continent. However, between 2015 and 2021, the country added a little over 5.0% power to the electricity access rate. The World Bank’s Africa Pulse Report pointed out that the COVID-19 pandemic has had a sharp, adverse effect on access to electricity, adding, the pandemic eroded gains made in the preceding five years.

     

    “The pandemic eroded gains made in the preceding five years—the number of people without access to electricity increased by 4% in 2021, compared to 2019. This was the result of compounding challenges, including (1) limited fiscal and financial capacity to develop new grid and off-gird connections by both governments and households, and (2) lockdowns resulting in supply chain disruptions and other logistical disruptions”.

     

    However, in Ghana, Kenya, Rwanda, Senegal, and Côte d’Ivoire, the numbers were stable or reduced.

     

    The pandemic, it mentioned, had the largest effect on the installation of new stand-alone off-grid systems, as the majority of new connections since 2020 have been grid connections. Sales of independent solar home systems, including solar panels and batteries with a capacity of at least 20 watts, declined by roughly 20% in Sub-Saharan Africa between 2019 and 2021.

     

    Meanwhile, Côte d’Ivoire and Kenya were ranked 2nd and 3rd respectively in Sub-Saharan Africa with the biggest electricity access rate.

     

    COUNTRIES ELECTRICITY ACCESS RATE POSITIONS

    Ghana 81.2% 1st

    Côte d’Ivoire 77.0% 2nd

    Kenya 76.0% 3rd

    Senegal 73.5% 4th

    Nigeria 69.1% 5th

    Rwanda 65.0% 6th

    The Gambia 61.0 7th

  • NDC in Kroboland to sympathize with brutalised indigenes

    NDC in Kroboland to sympathize with brutalised indigenes

    For Immediate Release:       

    28th August, 2022    

    NATIONAL LEADERSHIP OF NDC VISITS  LOWER MANYA AND YILO KROBO AREAS IN THE WAKE OF RECENT IMPASSE WITH THE ECG.

    The National Leadership of the National Democratic Congress (NDC) paid a working visit to the Lower Manya and Yilo Krobo areas yesterday as part of our ongoing membership drive and reorganization activities in the Eastern Region .

    This visit comes in the wake of a recent standoff between indigenes of these communities and the Electricity Company of Ghana (ECG), which resulted in the latter disconnecting electricity supply to these areas for several weeks.

    Having followed developments in the Krobo enclave and interacted with the Chiefs and people of the area, the party has become aware of the longstanding impasse between residents and the ECG over the installation of prepaid meters, which not long ago degenerated into violent protests, leading to loss of lives in process.

    The party’s leadership is appalled at how a simple process of installing prepaid meters for residents in these communities has been badly managed by the Akufo-Addo government, the Ministry of Energy and Management of the Electricity Company of Ghana. We hold the view that the military-backed forced installation of prepaid meters in the area without proper community engagement and sensitization was completely unnecessary. .

    The recent crisis has brought economic activities in the Krobo area to a halt and exacerbated the hardships the people in the area are already reeling under. Hospitals were forced to shutdown leading to loss of lives, while schools, businesses and households all bore the brunt of the nearly one month freeze on electricity supply to these areas.

    The NDC condemns in no uncertain terms vgovernment’s high-handed approach to resolving these issues and the brutalities meted out to innocent citizens in the area by the military. And we sympathize with the residents of these communities who have been at the receiving end of such mistreatment by the government through its agents.

    We call on government to as a matter of urgency withdraw all military personnel who have been deployed to the Krobo area in order to ease the unnecessary tension and give way for citizens to go about their normal lives freely. The Akufo-Addo/Bawumia government must change its modus operandi and adopt a humane approach in addressing the “Kroboland”- ECG crisis.

    Signed.

    Hon. Samuel Ofosu Ampofo

    National Chairman, NDC

  • PURC extends announcement date of new utility tariffs by two weeks

    PURC extends announcement date of new utility tariffs by two weeks

    The Public Utilities Regulatory Commission (PURC), has set a new date for the announcement of its decision on the 2022-2027 Multi-Year Major Tariff Review.

    Last week Friday, 1st July 2022 was the initial date set for the announcement of the Commission’s decision on the review of water and electricity tariffs for 2022-2027, but, for the major interest of Ghanaians, had to extend the date to 15th July 2022.

    The Commission explained that the postponement was to allow for broadening of tariff consultation to solicit more independent views; independent verification of submitted projects (completed or work in progress) and deeper consultation with key stakeholders such as the utilities.

    “The above has led to the need for more time for further review of the tariff proposals submitted by the utility service providers, and to incorporate the findings of the regulatory audit and views of all stakeholders across the country”, a statement issued by the Commission and signed by Dr Ishmael Ackah said

    “The Commission has engaged most of its stakeholders, including the Parliamentary Select Committees on Finance; Mines and Energy; Water, Works and Housing; Development Partners; Civil Societies; Organized Labour; Industry; Media; Religious Groups; Academia, and the general public,” the statement added.

    The Commission assured all stakeholders of its commitment to ensuring a transparent, fair, and all-inclusive process in determining the multi-year tariff.

  • PURC shot-down the rate of increment proposed by ECG and GWCL

    PURC shot-down the rate of increment proposed by ECG and GWCL

    Adnan Adams Mohammed

    The Public Utilities Regulatory Commission (PURC), has indicated that utility service providers won’t get anything close to their huge tariff demands.

    This latest pronouncement is a reveler to many as the Commission is yet to complete its ongoing nationwide public hearing on the proposed tariff reviews.

    The Electricity Company of Ghana (ECG) has proposed an increment in tariffs by 148% while the Ghana Water Company Limited is asking for its tariffs to go up by 343%. This ignited a heated debate with majority of consumers opposing the proposed increment.

    “Though PURC is still considering a number of things, the utility firms will not get the huge margins they had proposed”, the Technical Committee Chairman of PURC, Ishmael Edjekumhene, has said when speaking at the Takoradi Public Hearing on the proposed tariff review for 2022-2027.

    “We are now beginning the detailed analysis of the proposals to see how prudent their (utilities) cost are to see the extent to which they’ve complied with the guidelines that we provided to them and then ultimately, once we’ve looked at all the numbers provided, we will take a decision. That decision can either go up, stay the same or come down because in 2018 the commission looked at all the numbers and was able to tell Ghanaians or tell the utilities that even though you are asking for an increment we think that the tariff should come down.”

    “So once we are satisfied with the analysis, what Ghanaians should expect is an announcement. If you go and compare the history of tariffs setting in Ghana and you compare the proposals as submitted by the utilities to what is ultimately approved, you will see that there’s a vast difference. It is not going to be a straightforward matter in the sense that we are coming to look at the numbers and what I’m certain of is that there is nowhere some of the things they are talking about are going to end up being the cost that consumers are going to pay”, he said.

    The Executive Secretary of the PURC, Dr. Ishmael Ackah also speaking at the Takoradi organized public hearing on the tariff proposals said the utility companies could have done themselves good if their service provision had been better all this while and could have helped them from the resistance by consumers to pay more.

    “47% of about 851 respondents in a survey we conducted indicated that they are willing to expect some adjustments on the condition that services will improve. So this year, in September, PURC is launching a customer service clinic so that utilities will tell customers that you can apply for a meter even if you don’t know any big man and that it will take you three days for you to get the meter even if you don’t know any honourable member. If we are able to do these things, I think it will reduce the number of PowerPoint slides you present at these forums just to make a case for the increment to consumers”, he said.

    The Public Utilities Regulatory Commission’s Takoradi Public Hearing on the proposed Tariff Review for 2022-2027 is the third after Accra and Ho in series of nationwide public hearings to enable utilities explain to consumers the rationale for their huge tariffs increment proposals.

    Meanwhile, majority of consumers who spoke at the Takoradi hearing shot down the tariff increment proposal.

  • Utility tariffs increment: Make your voices heard – Chief of Staff to stakeholders

    Chief of Staff Frema Osei-Opare has said all the stakeholders must make their voices heard in the process of announcing new utility tariffs by the Public Utilities Regulatory Commission (PURC).

    “It is my fervent hope that all stakeholders will engage actively in this review process and make their voices heard so that the final outcome will benefit the generality of all stakeholders,” she at the inauguration of an office complex for the PURC in Koforidua.

    The Head of Public Relations and External Affairs of the PURC said the Commission will also consider the interest of the investor community and the interest of the utility companies before announcing the new tariffs.

    The PURC had earlier noted that this year’s approved tariffs for utility service providers will be announced on July 1, 2022.

    According to the PURC, the tariffs could be increased or decreased.

    Dr Eric Kofi Obutey, the Director of Research at PURC made this known on Accra 100.5 FM’s evening news on Thursday, May 12, 2022.

    He said, for now, the Commission is engaging all the stakeholders to arrive at tariffs that will serve the need of Ghanaians as well as the service providers.

    Dr Obutey mentioned some of the stakeholders as the Parliamentary Select Committee on Mines and Energy; Association of Ghana Industries (AGI), and Ghana Employers Association among others.

    He explained that the stakeholder engagement before the announcement of the approved tariffs is mandated by law.

    Dr Obutey was hopeful that all the engagements will end by June for a decision to be taken by July.

    The Electricity Company of Ghana (ECG) and Ghana Water Company Limited have proposed 148 per cent and 334 per cent hikes, respectively, in tariffs.