Government's indebtedness to NEDCo amounts to GH¢1.06 billion – Report

Electricity IPPs Ghana Electricity tariffs to increase

Thu, 12 May 2022 Source: www.ghanaweb.com

Government debt crippling NEDCo

GH¢75.083 million subsidies not paid by government

Government institutions still use credit meters, Report/b>

A report submitted to the Public Utilities Regulatory Commission by the electricity Company to demand an increase in electricity tariffs has revealed that government owes the Northern Electricity Distribution Company (NEDCo) GH¢1.06 billion.

The debt is however negatively impacting the operations of the company.

“As of December 2021, the Government of Ghana owed NEDCo about GH¢1.069 billion with subsidies and street lighting in bills. These debts have made it difficult for NEDCo to meet its debt obligations to suppliers of electricity.”

The proposal submitted by NEDCo to PURC on its 2022-2026 Tariff proposals noted that GH¢75.083 million out of the total amount government owes are subsidies it has not been able to pay.

NEDCo also noted that due to the fact that the public sector still uses credit meters, unlike the private sector that has been migrated to prepaid meters, huge debts are accumulated by the government.

State institutions including Ministries, Departments, and Agencies (MDAs) that are connected to the national grid receive electricity supply from NEDCo.

Government has however not been paying the debts of these MDAs as expected.

NEDCo currently has a customer population of about 1,136,050 as of the end of 2021 made up of residential customers(84.96%), non-residential (15.03%), and 0.01% of Special Load Tariff (SLT) customers.

The report also noted that about 46% of the total customer population (516,547) are lifeline customers who consume power at GHp32.6060/kwh far below the total of the current approved DSC rate of GHp31.5307/kwh, TSC GHp7.9846/kWh and BGT tariff of GHp33.7957/kwh, which is GHp73.311/kwh.

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Source: www.ghanaweb.com
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