The Executive Secretary of the Public Utilities Regulatory Commission (PURC), Dr Shaffic Suleman, has revealed that the Government of Ghana spends an average of $92 million every month, in addition to electricity tariff revenues, to ensure a stable power supply across the country.
Speaking on JoyNews’ PM Express Business Edition on Thursday, Dr Suleman said the Ministry of Finance continues to make substantial monthly interventions to keep the energy sector operational and avert power outages.
He also disclosed that proceeds from the recently introduced ¢1 levy on petroleum products have already been deployed to address long-standing financial obligations within the energy sector.
“A report from the Finance Ministry indicates that the ¢1 on petroleum products that was passed has been used,” he said.
According to Dr Suleman, a report submitted to Parliament and reviewed by him showed that approximately ¢8 billion had been generated from the levy. He explained that the funds had been used to settle a significant portion of arrears owed to Independent Power Producers (IPPs), restore critical risk guarantees for the Sankofa Gye Nyame gas project, and clear outstanding debts that had adversely affected Ghana’s credit profile.
“We’ve also used some of it to pay to get back the risk guarantees on the Sankofa Gye Nyame gas production, and then we’ve also paid off the accumulated debt that was putting Ghana’s credit rating at a very terrible outlook,” he stated.
Dr Suleman noted that Ghana has successfully restored the World Bank risk guarantee with ENI, a development he said has strengthened investor confidence and improved the country’s credit standing.
“So it’s now making Ghana look so good, and our credit rating has also taken shape,” he added.
He further explained that part of the proceeds had been used to pay gas suppliers, including partners involved in the Sankofa and Jubilee oil and gas fields.
“We are using all that for the accounts I’ve seen to pay and sustain that part, and that’s actually what is keeping the lights on,” he stressed.
When asked whether the government’s intervention had substantially reduced the energy sector’s debt burden, Dr Suleman responded in the affirmative.
“Yes! It dropped the debt significantly. Now that’s what I’m saying, it’s not a debt-debt. So the government had to go and borrow to come and sustain the power sector,” he explained.
He emphasised that maintaining uninterrupted electricity supply throughout the year requires continuous financial support from the state, beyond what consumers pay through electricity tariffs.
“Every year, before our lights can be kept on consistently for 12 months, the Ministry of Finance must cough up money to ensure that we pay for the cost of all these fuels,” he said.
“So every month, on average, it’s $92 million. As we speak, it’s $92 million. When you see your lights on for 30 days, what it means is that aside from the tariff we are paying, the Ministry of Finance is also putting in $92 million to make the lights stay on.”
His remarks highlight the significant fiscal burden the government continues to shoulder to sustain Ghana’s power sector, despite ongoing efforts to improve revenue collection and reduce the industry’s long-standing debt.
