The Executive Director of ACEP, Benjamin Boakye has hinted that his outfit will engage ECG on the reasoning for its tariffs increment proposal.
The state power distributor has mounted a strong defence for its requests. In the midst of the intermittent power supply, ECG said it needs an increment in tariffs to aid its operations. However, the energy think thank wants further explanation for its request.
Given the complaints about ECG’s finances, ACEP intends to found out if tariff increment is the best option for the power distributor.
“We will be engaging subsequently to see how much they need and whether those demands are justified and whether improving their own systems could be the solution rather than an increment in the tariffs.
“If they are able to sell power and raise the needed financing, then they can be able to pay the value chain; GRIDCo and the generators.”
Benjamin Boakye, Executive DIrector of ACEP.
Also, Adam Mutawakilu, former MP for Damongo, has kicked against the tariff increment proposal. He said ECG has not demonstrated efficiency in its operations to merit an increment in electricity tariffs.
“How much of our monies are being lost? If that is not tackled, then we are wasting our time on this. They are just taking money from Ghanaians and wasting it.
“Technical and commercial losses alone are over 25%. This means that for every 100 million that ECG collects, they can’t account for 25 million of it. So, if we only concentrate on increasing tariff without reducing technical and commercial losses, we will come back to square one.”
Adam Mutawakilu, Former Ranking Member of Parliament’s Mines and Energy committee.
ECG’s tariffs increment proposal
The Managing Director of ECG, Kwame Agyeman-Budu hinted at tariff hikes to mobilize revenue for ECG’s operations. The Director said this at a public forum on Thursday, April 8, 2021. According to him, it is critical for ECG to have access to more funds to enable it operate efficiently.
“We need money to [improve] it . If we get the increase, we will love it. However, that will be up to the PURC because, no matter what we propose, they will ultimately decide.
“In terms of distribution, we need support because we have to do upgrades to make sure the system is sustainable. We don’t wait till something is broken before we fix it. We need additional funds to upgrade our systems at all times.”
Kwame Agyeman-Budu, ECG’s Managing Director
Currently, lifeline consumers, classified as poor and low-income earners, pay GHS16 for the power consumed. An extra GHS2.13 adds up as service charge, making the total of about GHS18.13.
The last increment in electricity tariffs was in October 2019. The Public Utilities Regulatory Commission (PURC) oversaw a 5.94% increment in the tariffs. Factors like the Ghana Cedi-US dollar exchange rate, inflation, demand forecast and electricity cost accounted for that increment.
The current proposal will only materialize after approval from the Public Utilities and Regulatory Commission.
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