Dr. Eric Kofi Obutey, Director of Research and Corporate Affairs at the Public Utilities Regulatory Commission (PURC), has justified the recent 2.45% increase in electricity tariffs, explaining that the adjustment is necessary to help clear outstanding debts owed by utility providers.
Speaking on Morning Starr with Naa Dedei Tettey on Wednesday, June 25, Dr. Obutey explained that the hike was largely driven by legacy debts carried over from previous quarters.
“So we do have a debt, an outstanding debt of $488 million, carried over from the previous quarters. And we need to clear that debt,” he said.
Dr. Obutey clarified that the total outstanding amount was $976 million, but half of that was settled during the previous tariff window.
“The total debt that was outstanding was $976 million in cities. However, we paid 50 percent of that in the previous tariff window. And we stated in the previous tariff window that we’re going to recoup the last 50 percent in the subsequent tariff window, which is $488 million,” he added.
He acknowledged that factors such as improved performance of the cedi against the US dollar and declining inflation should have led to a reduction in tariffs. However, the outstanding debt, combined with the cost of alternative fuels, offset any potential reductions.
“If we were to consider only the exchange rate effect and that of inflation, we would have seen a reduction in tariffs. However, the outstanding debts that we had to pay offset the decline in the tariffs,” he explained.
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Dr. Obutey further pointed out that the rising use of alternative fuels, such as crude oil and distillate fuel oils — accounting for 27 percent of energy generation costs — also contributed to the marginal increase.
The increment, announced by the PURC as part of its quarterly tariff review, takes effect from July 1, 2025. It applies to residential, non-residential, and special load tariff (SLT) customers.
According to the Commission, the adjustment is critical to ensuring the financial sustainability of utility service providers and guaranteeing stable electricity supply across the country.
The PURC maintains that the 2.45% increment is necessary to stabilise the energy sector and ensure reliable electricity supply for consumers.
Source: Ghana/Starrfm.com.gh/Hamdia Mohammed
