As government touts Ghana’s improving macroeconomic stability in its 2026 budget, the Africa Sustainable Energy Center (ASEC) is cautioning that the country’s progress may be undermined by unaddressed structural challenges in the energy sector.
According to ASEC, the sector’s longstanding inefficiencies particularly revenue losses at the Electricity Company of Ghana (ECG) pose a significant threat to fiscal sustainability despite the administration’s success in stabilizing the broader economy.
Speaking on the government’s latest budget, ASEC’s Executive Director, Ing. Justice Ohene-Akoto, acknowledged that Ghana has made commendable strides in promoting stability and improving sectoral allocations.
He noted that the government “has done well” and is “doing a good job in managing the energy sector,” adding that recent allocations to the sector “are good.”
However, he stressed that these achievements mask deeper weaknesses that continue to undermine energy sector performance.
“ASEC is questioning. We are warning that, hey, we don’t just have to allocate funds to a sector; we need to allocate funds to a sector with caution.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
Central to ASEC’s concerns is the government’s GH¢20 billion allocation to the energy sector, which Ohene-Akoto argues lacks adequate performance benchmarks.
He described the allocation as “the biggest risk in the loopholes that we have identified,” insisting that channeling funds into a system plagued by unresolved inefficiencies amounts to “fetching water into basket.”
He warned that without tying the funds to strict accountability measures, the government risks worsening the sector’s debt burden.
“We can’t keep channeling money into a sector where the fundamental issues have not been resolved.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
While acknowledging that the allocation is necessary, he maintained that it must be anchored to measurable deliverables, particularly those targeting ECG reforms.
ECG Identified as Weakest Link in Energy Sector Chain
ASEC’s most forceful criticism centers on ECG, which Ohene-Akoto described as “the weakest link” due to chronic revenue mobilization challenges.
The organization estimates that ECG loses more than 30 percent of revenue annually, a gap that if left unaddressed could nullify gains in other parts of the sector.
“If we don’t block that loophole and keep channeling money into the sector, it just keeps accruing the debts that we are having without resolving the fundamental issues.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
ASEC proposes a phased, results-driven approach to energy sector financing. According to Ohene-Akoto, government support should be conditional on ECG meeting specific revenue milestones.
“We need to tell ECG that, hey, you have to increase your revenue mobilization by less than 20 percent.
“If you are able to do that, that is when we are going to channel X amount to you.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
He emphasized that improved revenue recovery alone could significantly reduce the sector’s financial deficits, arguing that ECG’s recovery potential “can cover about 30 percent” of existing challenges.
ASEC also highlighted procurement irregularities at ECG as a major contributor to sector losses.
Ohene-Akoto referenced recent incidents involving missing containers and overspending that exceeded approved budgets, describing these as symptomatic of deeper governance problems within the utility provider.
“These are some of the things to tie to privatization of ECG, the procurement processes within ECG as well.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
ASEC argued that unless procurement reforms are enforced and linked to funding, the GH¢20 billion allocation risks perpetuating inefficiencies rather than correcting them.
Push for Fast-Tracked ECG Reforms
Among ASEC’s strongest recommendations is the fast-tracking of ongoing ECG reforms, particularly the privatization of the company’s commercial arm.
The 2026 budget mentions steps toward privatization later in the year, but ASEC believes this timeline is too slow.
Ohene-Akoto said, “We need to expedite that. We need to bring it to the first quarter,” arguing that early implementation would accelerate improvements in efficiency and revenue collection.
The ultimate goal, he said, is to establish an ECG capable of recovering between 90 and 100 percent of its revenue levels necessary for long-term sector sustainability.
ASEC insists that Ghana can secure lasting economic stability only if energy sector reforms become central to budget implementation.
Ohene-Akoto reiterated that tying the sector allocation to strict performance indicators remains the most reliable path to preventing future fiscal slippages.
“If you’re able to tie this 20 billion to performance accountability, then we should be in a good place. Else, we are just keeping accruing to the gaps.”
ASEC’s Executive Director, Ing. Justice Ohene-Akoto
The organization maintains that while Ghana’s macroeconomic progress is real, its durability depends heavily on whether the government confronts long-standing energy sector weaknesses that have historically undermined the economy.
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