Cut electricity tariff – CUTS Ghana urges PURC

Cuts Ghana, a research and public policy think tank, has called on the Public Utilities Regulatory Commission (PURC) to review electricity tariffs for all classes of electricity consumers.

Mr Appiah Kusi Adomako, the Country Director of CUTS Ghana, said in a statement that currently, the cost of energy supply is going down across the world, hence the PURC must also review electricity prices downward.

“In the light of the falling prices of the key input fuel for power generation in the world market, it is fair and reasonable for the PURC to consider immediate review of electricity tariffs to give relief to businesses and consumers.

“From the last review of tariffs when it took effect from July 1st, 2019, the Commission made their tariffs determination based on some key assumptions, which have changed substantially.

“With respect to natural gas and heavy fuel oil (HFO) as fuel for generation of electrical energy for the 2019-2020 tariff period, the Commission approved a US$ 6.08/MMBtu as the Weighted Average Delivered Price of Gas and US$ 390/Metric Tonne for HFO,” the statement said.

It further stated that “now, with the fall in demand for crude oil and natural gas, the current price for natural gas has fallen from $6.07/MMBtu in July 2019 to $1.8/MMtu as of today. At the same time, crude oil has fallen to about $20 per barrel”.

“According to the Ministry of Energy, the total installed capacity for existing plants in Ghana is 4,132MW consisting of Hydro 38%, Thermal 61% and Solar less than 1%. Since about two-third of Ghana energy mix is from thermal sources which use either natural gas or crude oil which has seen a drastic fall in prices from the previous review, the Commission should as a matter of priority consider tariffs review.

“All over the world, countries that depend on natural gas and fuel have seen prices of electricity going down and for that reason Ghana cannot be an exception to this obvious reality.

“As it has always been the case for tariff review in Ghana whereby utility providers submit proposals to the PURC for upward review, today, we the consumers of electricity in Ghana are calling on the Commission to act in the interest of electricity consumers and review prices down.”