Ghana raises IPP payments from 40% to nearly 100% – Dr Jinapor discloses

Ghana's Minister of Energy and Green Transition, Dr John Abdulai Jinapor, has disclosed that the government has increased payments to Independent Power Producers (IPPs) from about 40% to nearly 100% of their monthly bills, as part of measures to restore financial stability in the electricity sector.

Addressing Energy Ministers and players in the Energy space at the 16th Meeting of ECOWAS Ministers in Charge of Energy in Accra, Dr Jinapor said that several IPPs were threatening to curtail power generation due to persistent payment arrears when the government assumed office.

He said the government subsequently introduced aggressive revenue mobilisation measures and other reforms to strengthen the financial position of electricity utilities and improve their ability to meet payment obligations to power producers.

According to the Minister, the measures initially generated public dissatisfaction because of the intensified approach to revenue collection. However, he maintained that the reforms were necessary to safeguard the stability of the power sector and prevent disruptions in electricity supply.

Dr Jinapor said the government deliberately prioritised financial discipline over the immediate political consequences of enforcing payment obligations, stressing that unreliable electricity supply would have severe consequences for households, businesses and the wider economy.

He noted that financially distressed electricity utilities could not sustain reliable power generation, while persistent payment challenges could undermine contractual obligations and weaken investor confidence in Ghana’s energy sector.

The Minister said the reforms were also aimed at strengthening Ghana’s capacity to meet rising domestic electricity demand while maintaining power exports to neighbouring countries.

He urged ECOWAS member states to strengthen financial management within their respective energy sectors, arguing that successful regional electricity integration would depend largely on the financial stability and institutional credibility of individual national power systems.

Dr Jinapor stressed that financially sustainable utilities were essential to ensuring reliable electricity supply and creating the confidence needed to attract continued investment into the region’s power sector.