Editorial Erratic power supply: ECG & power producers want tariff increment – simplicita
The Public Utilities Regulatory Commission (PURC), according to a myjoyonline.com report, has hinted of a major tariff review for both electricity and water supply this year. The utility companies, the portal alleges, have already been notified to submit their proposals for price adjustments, according to the Commission.
The Head of the Public Relations at PURC, Bawa Munkaila, was quoted as saying that the process for a tariffs review has begun, but stopped short of stating when the percentage increases will come into force. “Currently, we are at the pre-filing stage. We have held consultations with the utilities as to the content of the template that they will be using for their filing,” he said.
The Chronicle is not surprised at the disclosure by the PURC to adjust power and water tariffs. Readers will agree with us that for the past one month or so, power supply to all parts of the country has been very erratic, but that has been the usual strategy by the power producers and distributors to justify increments in tariffs. Bawa Munkaila has, therefore, come to confirm the already open secret.
In our view, if the increment in tariffs will lead to stable supply of power for both domestic and industrial use, consumers will be happy with it than what they are currently experiencing. Industries are suffering because the constant power outages are disrupting their production, which in turn is making it virtually impossible for them to meet the demand of their customers and consumers.
Already, victims of fire outbreaks in Sunyani are attributing the situation to unstable power supply to the metropolis. The Chronicle does not have any evidence to support what the fire victims are alleging, but looking at the way power has been on and off in recent times, the victims may not be far from telling the truth.
All over the world, payment of taxes and utilities are like pulling a strand of hair from one’s nostril – it is a painful thing to do, but it is at the same time necessary, because every economy runs on taxes. In the 1960s down to 70s and 80s, Ghanaians were paying for lower power tariffs because the country relied heavily on the Akosombo Hydro Dam. Because it is a hydro dam, the power it produces was and is still cheap, but the situation has dramatically changed.
During the periods we have mentioned above, the size of Ghana’s economy was nothing to write home about. But, today, our national economy has expanded in leaps and bounds, with the current Gross Domestic Products standing at $67 billion. If it is true that expansion of an economy always comes with increment in electricity usage, then the country can no more rely on cheaper supply of power from the Akosombo Dam.
According to the Energy Commission 2019 report, as at the end of 2018, the installed electricity generation capacity available for grid power supply at the transmission level in the country was about 4,780 Megawatt (MW). The hydro component of this mix is 1,598 – 1,038 MW from Akosombo, 160 MW from Kpong, and 400MW from Bui. Meanwhile, the total demand for power during peak hours is over 2,000 MW.
This means the shortfall of over 500MW is being met by the independent power producers, who rely mainly on gas and crude turbines, which are far expensive than hydro. And also, looking at the current cedi-dollar ratio, which does not favour the country, one can conveniently states that power production in Ghana, at the moment, is not a child’s play. The consumer has to pay if we are to really ensure constant power supply.
But what The Chronicle is not happy with is the attempt to blame the current power fluctuation palaver on alleged maintenance works being carried out on both Ghana Grid Company (GRIDCo) and Electricity Company of Ghana installations. This is a complete lie – the truth is that ECG is not generating enough revenue to enable it pay the power producers.
On the basis of this, The Chronicle will support a minimal increment in power tariffs to enable both the ECG and power producers break even. Like petrol, any increment in power tariffs results in an upward adjustment of consumables.
This places a great burden on the ordinary Ghanaian. The government, therefore, has the duty to come out with policies and strategies that will ameliorate these sufferings.