The Africa Sustainable Energy Centre (ASEC) has commended President Mahama’s administration for the payment of US$1.470 billion Energy Sector Debt, an action taken to stabilise Ghana’s energy sector.
In a statement issued on Monday, January 12, ASEC welcomed the clearance of the legacy sector debts, the restoration of the World Bank Partial Risk Guarantee, and the settlement of outstanding obligations to gas suppliers and Independent Power Producers.
According to ASEC, these actions represent a critical step in reducing systemic risk, restoring investor confidence, and strengthening Ghana’s credibility with international partners.
The Energy Think Tank noted that this intervention aligns with its prior calls for urgent government action to address the unsustainable accumulation of energy sector arrears, which had become one of the most significant threats to power supply reliability, public finances, and industrial growth.
While commending government’s action, ASEC stressed that the long-term sustainability of these gains depends on resolving the persistent revenue and commercial losses at the Electricity Company of Ghana (ECG).
ECG’s total system losses—widely estimated at over 30 per cent of energy distributed—translate into billions of Ghana cedis in lost revenue annually, undermining the entire power sector value chain.
ASEC therefore urged Government to accelerate the implementation of the following priority reforms, consistent with some recommendations it had previously suggested.
ASEC wants a comprehensive reform of ECG’s commercial operations by first quarter of 2026, with a strong focus on privatising the commercial arm of ECG, deploying smart meter technology at scale, strengthening revenue management and data analytics, reducing technical and commercial losses, improving corporate governance and accountability, and enforcing disciplined billing and collections to significantly boost revenue mobilisation and eliminate avoidable leakages.
Also, the Centre has suggested that government maintain disciplined implementation of the Cash Waterfall Mechanism to ensure predictable and timely payments across the energy value chain.
ASEC has proposed that government align tariffs with cost-reflective principles, while protecting vulnerable consumers through targeted and transparent subsidies.
It further urged government to improve power procurement and long-term planning to avoid excess capacity costs that continue to burden the sector financially.
ASEC emphasised that while clearing inherited arrears is commendable, only deep, institutionalised reforms—particularly at ECG—will permanently break the cycle of energy sector debt accumulation.
ASEC reaffirmed its commitment to supporting Government and stakeholders through policy advocacy, research, and stakeholder engagement to build a financially sustainable, efficient, and resilient energy sector that underpins industrial growth and national development.
