Energy policy think tank, Africa Centre for Energy Policy (ACEP) has demanded for the complete withdrawal of the increased margins in the Price-Build-Up (PBU) of petroleum products in the country.
The National Petroleum Authority (NPA), in a unilateral decision made amendments in the PBU of the various margins – BOST Margin, the Primary Distribution Margin (PDM), Fuel Marking Margin (FMM) and the Unified Petroleum Price Fund (UPPF) Margin – which resulted in the additional charge of Ghs 0.17 pesewas to the already Ghs 0.30 pesewas Parliament approved charge on petroleum products in the 2021 budget.
Agitations from the various energy think tanks and the public especially resulted in the reduction of the additional Ghs 0.17pesewas charge by Ghs 0.8 pesewas.
But ACEP, commenting on the issue averred that the remaining Ghs 0.9 pesewas charged should be scrapped as the justifications provided by the NPA for charge are weak and and present unnecessary burden on Ghanaian consumers.
Adding that the timing of the introduction of even the Ghs 0.30 pesewas tax charge in the budget as well as that of the NPA, within the current economic context is poor and may make post-Covid recovery more difficult for individuals and businesses.
In its view, ACEP believes the prevalence of inefficiencies in the energy sector such as petroleum products smuggling and tax evasion which cumulatively amounts to some Ghs 4.4 billion loss to the state as well as rising debts in the sector, are responsible for the continuous increments in the price of fuel by authorities to make up for lost revenue.
ACEP therefore, has outlined for government, five (5) recommendations it believes will address the inefficiencies in the nation’s energy sector which will in many ways free up significant revenue for government and also check the ‘incessant’ increment in fuel prices in the country.
The recommendations included;
- The deepening of electronic tracking of petroleum product to save the consumer from the ineffective but expensive marking of petroleum products.
- Fixing the debt accumulation in the power sector to avoid the persistent increase in petroleum taxes to pay energy sector debt.
- NPA must investigate the coincidental adjustment of OMC margins and demonstrate to the good people of Ghana how it intends to prevent anticompetitive behaviour in the downstream sector.
Peruse below details of ACEP’s commentary on increased price margins of fuel:
ACEP's Comments on Fuel Price Increments by Fuaad Dodoo on Scribd
