Emissions levy will increase cost of electricity generation - IPPG

The Chief Executive Officer of the Chamber of Independent Power Generators, Ghana (IPGG), Dr. Elikplim Kwabla Apetorgbor, has disagreed with the government's decision to collect the Emission levy.

He said the Emissions Levy Act, 2023 is a political risk(an increased cost event)that will increase the cost of power.

Apetorgbor in a statement noted that in the end, the levy will lead to an extra cost for users.

The Emissions levy was implemented on February 1, 2024, and this imposes a levy of GH¢100 per tonne on carbon dioxide equivalent emissions from the electricity producers, as statutory incidence.

Other cars and motorcycles also have statutory payments they make to the government.

“In accordance with the Power Purchase Agreements (PPAs), this legislation is a political risk (an Increased Cost Event) mitigated by an Increased Costs clause in the Agreements, which suggests a pass-through mechanism, where the economic incidence goes to the end user,” Apetorgbor was quoted by myjoyonline.com.

“As a direct consequence of this statutory incidence on the power producers, there will be an upward adjustment in the cost build-up of the electricity generation. Power plant management and operation are cost sensitive just as the downstream petroleum sectors. Specifically, the levy will be added to the operational costs build-up of the power plants,” he added.

SSD

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