The Public Utilities Regulatory Commission (PURC) has announced an upward adjustment in the average end-user tariff for electricity by 14.75%, and a 4.02% increase in water tariffs across the board for all categories of consumers.
In a statement, the Commission justified the decision, stating that the adjustment is in line with its quarterly tariff review mechanism, as outlined in its rate-setting guidelines for the periodic adjustment of natural gas, electricity, and water tariffs.
According to the Commission, the adjustments are driven by four key variables: the Cedi/US dollar exchange rate, inflation, electricity generation mix, and the cost of fuel (mainly natural gas) in electricity production.
The move, the Commission explained, is intended to avoid both over-recovery and under-recovery of revenues.
In July last year, the Commission increased utility tariffs, raising electricity by 4.22% and water by 1.18%.
Today’s announcement of another upward adjustment means that, in less than one year, the average Ghanaian consumer has cumulatively borne an 18.97% increase in electricity tariffs and a 5.20% increase in water tariffs — a situation that adds further strain to already fragile economic conditions.
The Commission further justified the increment by pointing to the under-recovery of revenue by utility companies, a situation it described as causing serious “bleeding” in those entities. It warned that failure to increase tariffs could potentially push the utility companies out of business.
The statement also highlighted the Commission’s restraint in the adjustments, arguing that the increments could have been more severe had it opted to recoup 100% of the outstanding debts from previous quarters.
DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
