The Ghana Energy Company (ECG) has proposed to the Public Utilities and Regulatory Commission (PURC) that electricity rates be increased by up to 148% from 2019 to 2022.
In addition, the state electricity distributor recommended a 7.6% price rise over the following four years to meet Distribution Service Charges (DSC).
The substantial rise in Distribution Service Charges was ascribed to
"The consequence of ECG's tariff plan for the next five years is a roughly 148 percent raise over the existing DSC1 in 2022, with an average annual increase of 7.6% from 2023 to 2026." "The large rise in the DSC1 for 2022 might be ascribed to the growing disparity between actual cost recovery tariffs and PURC authorized prices, as well as the cost of completed projects."
"Similarly, ECG's planned DSC2 indicates a bigger rise of 28.4 percent in the first year (2022), with successive years' increases averaging 2% from 2022 to 2026," it continued.
ECG's management also stated that its financial stability is critical since it has an influence on the whole energy industry.
"The financial viability of Ghana's Electricity Company is critical since it affects the whole energy industry. With the distribution industry's massive investment demands over the next five years, it's predicted that the proposed price hikes would undoubtedly be authorized to maintain efficient and dependable electrical delivery."
"To cover distribution costs, the DSC will need to climb continuously (average of 7.6%) for the following five years." The authorized BGC is expected to align with the contractual conditions of PPAs (Power Plant Agreements)," it noted.
The planned price rises are expected to be approved due to the distribution industry's huge investment demands over the next five years to maintain efficient and dependable electrical service."
"To cover distribution expenses, the DSC will have to continue to rise (at an average of 7.6%) over the next five years." The permitted BGC is expected to comply with the terms of PPAs (Power Purchase Agreements) "It was mentioned.