The Electricity Company of Ghana (ECG) is facing extreme debt crisis, particularly resulting from supposed inefficiency and gross revenue losses. The situation is also taking a toll on government budget, in that a chunk has had to be set aside to cushion the government outfit on several occasions.
As a result, there is worry that consumers could be made to bear the burden, as the outfit deliberates on tarrif increment to make up for its shortfalls as usual.
However, the Minister for Finance, Dr. Cassiel Ato Forson says consumers cannot be made to bear such a burden any longer. According to him, there needs to be new reforms to address the current challenges.
“Consumers cannot be forced to pay higher tariffs to cover ECG’s inefficiencies. Instead, we must address the root causes—inefficient billing, high system losses, and poor financial management,” he said.
He made these remarks during the National Economic Dialogue (NED) his commenced yesterday, March 3, 2025. The Minister lamented the current worrying situation, discribing the ECG’s operations as unsustainable and warning of a future collapse in the absence of urgent reforms to address its fiscal challenges.
“The inefficiencies at ECG are costing the nation heavily. Government transfers to support the energy sector have reached unsustainable levels, yet the company continues to struggle with revenue collection and operational inefficiencies,” he said.
The alarming situation according to Dr. Ato Forson, is such that the ECG currently collects only 62% of its power distribution in revenue terms, leaving 38% energy supply unaccounted for. Hence, predictably, a cumulative energy sector loss could exceed $9 billion by 2026, says the minister.
Some of the factors said to be contributing to the ECG’s losses include high distribution losses, poor cash management and non payment of bills.
He decried that instead of the power sector becoming a key driver of industrial growth, “it has become a financial black hole, dragging the entire economy down.”
The minister has, therefore, called upon all stakeholders to come together in deriving sustainable plans to address current challenges, else “if we do not act now, ECG will cripple Ghana’s economy. We cannot continue pouring billions into a broken system,” he concluded.
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Source: Dehotpress
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