Finance Minister Ken Ofori Atta has attributed the high cost of electricity tariffs in the country to the wasteful expenditure in the energy sector.
According to him, the situation is making Ghana uncompetitive for manufacturing, thus holding back our industrialization and job-creation agenda.
Addressing Parliament during the 2019 mid-year budget review, Ken Ofori Atta said "Mr. Speaker, the total costs in the energy sector that Government had to cover in 2018 amounted to US$520 million (GH¢2.7 billion). Moreover, by end of June this year, Government had made total payments of US$604 million (GH¢3.14 billion), and if we do not urgently address the problems in the sector, the projected Government payments in 2019 will be at least US$1billion, (GH¢5.2 billion).
"Our top technical experts, assisted by counterparts from the World Bank, have subjected the energy sector to a thorough analysis and produced the Energy Sector Reform Programme (ESRP), which identifies the key issues in the sector and proposes solutions. According to the ESRP, which has been approved by Cabinet, if we continue with business as usual in the energy sector, the costs to Government will increase over time to an accumulated total of over US$12.5 billion by 2023. ."
The Finance Minister stated that "these wasteful expenditures in the energy sector are one of the main causes of increases in end-user electricity tariffs, imposing hardships on Ghanaians. Similarly, this makes Ghana uncompetitive for manufacturing, thus holding back our industrialization and job-creation agenda. What’s more, these wasteful payments are putting pressure on our foreign currency reserves and on the exchange rate."