Majority Leader Mahama Ayariga has justified the Public Utilities Regulatory Commission's (PURC) decision to increase electricity tariffs by 2.45% across the board effective July 1.

Speaking on the floor of Parliament on Friday, June 27, the Majority Leader noted that there is a need for the Electricity Company of Ghana (ECG) to be able to settle its growing debt.

"You all know that the whole of last year and before that, there was an effort to prevent the PURC from adjusting the tariffs. So that whole period, there was no adjustment, and you know very well that bills were accruing; payments have to be made."

"ECG is accumulating huge [debt] and it has to be paid, so who is supposed to pay? Is it not the consumer?" he questioned.

According to him, failure to address ECG's indebtedness would render the company powerless in supplying power to its consumers.

"And if you are not adjusting the tariffs to enable ECG to pay, ECG is going to collapse. They are no longer able to buy the input needed to keep the generators on, and we are going to have a power outage; the bills have to be paid."

"The bill has to be paid. So if PURC is doing its work, I do not think there is a basis for saying that because we have improved the economy, it doesn’t mean that the debt at ECG will just be whisked away. The bill has to be paid partly by consumers," he asserted.

ECG owes over GHC68 billion to companies it engages.

The recent adjustments by the PURC have been carried out in line with the Commission’s Quarterly Tariff Review Mechanism, tracks and incorporates movements in key factors which are beyond the control of the Utility Service Providers (USPs), namely the exchange rate between the US$ and the Ghana Cedi, domestic inflation rate, the electricity generation mix, and the cost of fuel, mainly natural gas.

There will be no increase in water tariffs.

According to the Commission, the factors it took into consideration before concluding the hike in tariffs include the exchange rate, inflation rate, price of natural gas, electricity generation mix, outstanding debt of GHC488 million carried over from the previous three quarters.

The others are reserve capacity for grid stability and reliability, as well as inclusion of 27% of the cost of alternative fuels such as Distillate Fuel Oil (DFO), Heavy Fuel Oil (HFO) and Light Crude Oil (LCO).

The Commission has expressed gratitude to stakeholders for their support as it continues to implement the Quarterly Tariff Reviews per its Rate Setting Guidelines to address changes in operational conditions of the service providers.

"The Commission will continue to monitor the operations of the regulated service providers and to hold them accountable to its regulatory standards and benchmarks to ensure value for money and improved quality of service delivery," the Commission added in its statement.

PURC electricity tariffDownload

The Public Utilities Regulatory Commission (PURC) previously announced a 14.75% rise in electricity tariffs for end-users, alongside a 4.02% increase in water tariffs across all consumer groups.

These changes came after the Commission’s regular tariff review process for the first and second quarters of 2025.

The PURC attributed the tariff adjustments to several factors, including fluctuations in the exchange rate between the Ghana cedi and the US dollar, inflation, the rising costs of fuel, particularly natural gas, and the current mix of hydro and thermal power generation.

However, the Executive Secretary of COPEC, Duncan Amoah, disagreed with the hikes, labeling them as unreasonable and unjustified.

“If you look at the circumstances surrounding the ECG, there are issues of accountability that render even public procurement processes and laws moot and ineffective. We have almost 2,000 containers unaccounted for, running into hundreds of millions of Cedis."

“Then, we turn back and claim we don’t have money, hence being unable to sustain operations. Therefore, we are raising tariffs. This doesn’t add up, and PURC needs to backtrack on the decision.”