Minority in Parliament accuses PURC of using incorrect calculations in tariff adjustments
The Public Utilities Regulatory Commission (PURC) of Ghana has come under fire from the country’s Minority in Parliament for its recent tariff adjustments, with the Caucus claiming that the Commission used incorrect calculations in its methodology.
In a press statement issued by the Ranking Member on Parliament’s Energy and Mines Committee, John Abdulai Jinapor, on Friday, the Minority, made up of National Democratic Congress (NDC) MPs, stated their opposition to the increases and accused the Commission of using an unorthodox method to help the government meet its IMF conditionalities in the energy sector.
PURC has increased electricity and water tariffs by 29.96% and 8.3% respectively, with the new rates set to take effect from February 1, 2023. The Commission has stated that the process is in conformity with the Quarterly Tariff Review Mechanism and Guidelines as communicated in the Commission’s August, 2022 major tariff review decision.
However, this announcement has been met with resistance from Civil Society Organizations (CSOs) and consumers. The Institute for Energy Security (IES) has questioned the assumption used in establishing the new electricity tariffs, stating that the assumption amounts to giving priority to thermal power generation over hydro, given the improved water elevations at the Bui and Akosombo generating stations.
This controversy comes amid a challenging economic environment for Ghana, with the IMF forecasting the country’s GDP to contract by 1.9% in 2021, amid the ongoing COVID-19 pandemic. The tariff increases are likely to be met with resistance from consumers already facing financial difficulties due to the economic downturn.
The Minority has demanded that PURC refrain from such unorthodox methods and called on the Commission to protect consumers. It remains to be seen how the government and the Commission will respond to these criticisms, as Ghana looks to address its energy sector challenges and revive its struggling economy.
