Amid growing public outrage over proposed tariff hikes by the Volta River Authority (VRA), Electricity Company of Ghana (ECG), and Northern Electricity Distribution Company (NEDCo), energy sector analysts are warning that government must tackle a more pressing issue: the intentional over-procurement of power and the appointment of unqualified officials to sensitive roles.
Benjamin Nsiah, Executive Director of CEMSE, told ABC News GH that the structural inefficiencies and procurement failures within the sector are largely to blame for the debt spiral that has forced utilities to demand higher tariffs.
“It is not the fault of the end user that ECG continues to under declare revenue and over procure, which leads to huge liabilities,” he said.
The implications of over-procurement are stark. Ghana frequently contracts more power than it can distribute or use, creating excess capacity charges that saddle government with obligations to independent power producers.
These costs, Nsiah explained, are then passed on to ordinary consumers through fuel levies, tax subsidies, or service charges.
At the heart of the problem, he argued, is the intentional appointment of individuals without the requisite capacity and experience to lead procurement departments. These decisions, he said, perpetuate waste and inefficiency, further inflating the sector’s liabilities.
“When we intentionally over procure what we need, and appoint persons without the expertise, we end up burdening citizens with debts they did not create,” Nsiah noted.
The PURC hearings revealed that beyond ECG’s 224 percent request, NEDCo is seeking a 171 percent increase, while Enclave Power Company tabled the steepest request at 147.18 pesewas per kilowatt-hour.
VRA’s 59 percent hike in its Bulk Generation Charge also points to the rising costs across the sector.
For Nsiah, reform is the only sustainable path forward. Cutting wasteful procurement, enforcing accountability in leadership, and demanding efficiency in operations, he said, are the steps government must take if Ghanaians are to be spared from the crushing weight of continuous tariff hikes.
