Deputy Energy Minister, Andrew Egyapa Mercer, has revealed that he does not foresee Ghana going back to times of sporadic power supply, otherwise known as ‘dumsor’.
Mr Mercer indicated that fears of a likely return to days of ‘dumsor’ are unfounded despite demand by the Electricity Company of Ghana (ECG) for a 148% increase in electricity tariff. He explained that government has engaged Independent Power Producers (IPPs) for additional power capacity to be added to the current power generation efforts.
“I do not foresee that we are going to have dumsor anytime soon. I do not foresee that the conversations that are actually ongoing today will lead to dumsor anytime within the foreseeable future. Like I indicated, the Energy Commission has a demand forecast system that projects additional power generation that government from time to time ought to add to the generation mix.”
Andrew Egyapa Mercer
Deputy Energy Minister emphasized that the Ministry will make adequate use of resources within its power to ensure there is abundant power generation for consumers.
“We are following that [power generation mix] strictly and will ensure that there are no gaps that would then lead to deficiency in our generational capacity that could result in lack of electricity for our consumers. That I can assure you is what we are doing.”
Andrew Egyapa Mercer
His comments followed a proposal submitted to the Public Utilities Regulatory Commission (PURC) by the ECG of a 148% adjustment to cover the period 2019 and 2022. The ECG has subsequently proposed an average increase of 7.6% in tariff over the next four years to cover Distribution Service Charges (DSC).
Ghanaians must not suffer for ECG’s inefficiencies
Meanwhile, Member of Parliament for Yapei Kusawgu, John Jinapor, indicated that the ordinary Ghanaian must not suffer for the inefficiencies of the ECG. The member of Mines and Energy Committee of Parliament explained that other factors leading to the increase is the exchange rate and the fall of the cedi, a phenomenon he attributed to “bad management of the economy”.
“Why are they going back to 2019 and 2020? We cannot adjust prices for those years and go back again. Moreover, ECG’s losses has increased from 22 per cent to 30 per cent. These inefficiencies cannot be passed onto consumers.”
John Jinapor
On his part, the Executive Director of the Africa Centre for Energy Policy (ACEP), Benjamin Boakye, opined that the government is spending too much money in making the ECG efficient. He explained that the ECG should be able to generate its own funds from tariffs to manage the operations in order to reduce the dependence on government.
“First of all, these are proposals and as is always done, when there is a major tariff announcement, the utilities will make proposals and PURC will examine the proposals to do further engagements with stakeholders and determine what the optimal tariffs would be. From where we sit, we do not see why the tariff would not go up. If you look at the last tariff adjustments and you discount that by just the depreciation of the Cedi, most of the payments are made in dollars, that alone, the existing tariff has got about 32 per cent value…
“We needed government to pay ¢1.25 billion dollars just in 2021 to be able to offset the under recoveries in the space… We cannot continue to get that support from government when ECG needs to improve its efficiency given the right tariff for them to be able to reduce their reliance on government.”
Benjamin Boakye
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