$1.5bn losses in Genser/GNPC deal to lead increased utility prices – ACEP
Executive Director of ACEP, Ben Boakye, has remarked that the estimated $1.5bn losses to the State in the GNPC/Genser deal will result in increment in utility tariffs in the coming months.
According to him, the losses from the deal will be factored into the upcoming upward tariff adjustments as required by the IMF in the country’s $3bn bailout programme.
“The public is going to pay for it, we are already paying for it. What the finance ministry has failed to do is to be much more rigorous in its analysis of where the shortfalls are coming from so they only see shortfall coming from the gas sector.”
“The shortfalls goes straight to the finance ministry for finance ministry to pay, and the finance ministry through the scheduled upward tariff adjustment as required by the IMF ensures that the shortfalls are accounted for in the electricity tariffs,” he noted.
Echoing the same sentiments, Vice President of IMANI, Bright Simons posited that the earlier estimated $1.5bn losses from the GNPC/Genser deal is likely to increase to almost $2bn given the future increment in gas prices.
“The price of gas will keep going up in Ghana, and that will mean that the original calculation in which we used $6.8 as the price of gas to come up with the $1.5 billion losses is already outdated. We now must update that amount to a 25% increase and that implies a loss of almost $2 billion if this transaction continues for the next 13 years without amendments.”
“So we are losing money and we will continue to lose money every single year until we amend this contract and come up with a better framework,” he stated.
Speaking further during the X Space Conversation, Mr Simons noted that the estimated $1.5bn losses will lead to higher inflation, high utility tariffs and higher debt obligations for the government, all of which will mean increased hardships for the Ghanaian citizenry.
The PURC this week increased electricity tariffs for non-life consumers by 4.2%, this follows some 18.36% increase in electricity tariffs across all consumer groups three months ago.
