The Electricity Company of Ghana [ECG], will continue to incur huge loses annually which will affect power supply if the Public Utilities Regulatory Commission (PURC), does not implement an automatic tariff adjustment formula for ECG.
According to the General Manager in charge of Business Development at the Electricity Company of Ghana (ECG), Theo Asante Darko, the country may not be able to adequately solve its power challenges if calls for the automatic price adjustment formula is ignored.
The PURC is mandated by law to protect the interest of both consumers and provides of utility services by setting standard or reasonable tariffs and charges for utility service providers.
Ghana in the past few weeks has been experiencing erratic power cuts in some parts of the country. Some analysts have blamed high indebtedness among companies in the power generation, transmission and distribution chain.
In the case of ECG in particular, they have been blamed for much of the debt to the power producers due to the huge losses they incur as a result of poor collection and power theft.
Bad contracts, high debts cause of Ghana’s energy woes – ACEP
The Executive Director of the Africa Center for Energy Policy, ACEP, Ben Boakye, has explained that the country’s current energy challenges resulting in a frequent power outage is due to the sector’s high indebtedness.
Speaking on Citi TV’s Point of View, Ben Boakye indicated that, the Electricity Company of Ghana (ECG) was the most indebted agency within the sector with a debt of almost Ghc1 billion as of July 2018.
“We have to address the fundamental cause. The power sector is on steroids because we haven’t stopped creating the debts. If you check ECG’s operation for 2018, documents I’ve sighted showed that first quarter of 2018, they made a loss of almost Ghc1 billion. If they are making losses, they are not able to pay. and if they are unable to pay then the generator will have to call on the one who owns the contract that is government and government will have to get money come and pay. So if we don’t solve that problem then we’ll have to use our taxes at a point to pay the generators.