ECG takeover won’t cause electricity tariff increase – PURC assures

• Posted on January 15, 2019
• by Ellsamwise King
• Comment

The Public Utilities Regulatory Commission (PURC) has parried claims that the new managers taking over ECG will result in an astronomical increase in electricity tariffs.

Ishmael Agyekumhene, Commissioner at the PURC, says his outfit would be regulating the new managers to ensure that no outrageous tariffs are imposed.

“If for example, ECG’s losses are around 24 per cent, we only allow 21 per cent so that they will pay the remaining 3 per cent. Where they will find the money to do that, we (PURC) don’t care,” he said.

He told Joy News that there are regulatory benchmarks and as the system improves, those thresholds will have to come down.

Minority spokesperson on Energy, Adams Mutawakilu, had earlier claimed the energy sector is in crisis, claiming that the ECG’s debt is inching towards ¢2 billion.

He blamed the situation on government’s decision to reduce electricity tariffs last year.

He said Meralco, which will take over the majority shares of ECG, is supposed to publish its proposal – which it did last Friday – and it is being regulated by the PURC.

“As far as the laws of Ghana are concerned, only the Commission approves tariffs; no other person, not even the president of the land, is           in-charge of that,” he said.

According to him, ECG in 2018 accrued a loss of ¢1.1 billion for the first part of the year and is expected to hit ¢2 billion this year.

“With this, you can see that the energy sector is in crisis…Ghana Grid Company (Gridco) and Northern Electricity Distribution Company (NEDCo) are all in crisis…the concessionaire is coming in with a mind to make profit….we should expect an astronomical increase in tariffs in 2019,” Mr Adams Mutawakilu said.

But the PURC Commissioner disagrees.

“We will do what we have to do to ensure that we pay fair prices for electricity and nothing outrageous,” he pointed out. 

However, some power players are asking for hikes in tariff. Power transmitter GRIDCo is pushing for a 95 per cent increase in tariff while NEDCO wants a 45 per cent increase.

The Trades Union Congress (TUC) which is unhappy about the proposals, insists tariffs must decrease.