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ECG justifies 148% trariff increase proposal.

ECG justifies 148% trariff increase proposal.
Electricity Company of Ghana.

The Electricity Company of Ghana (ECG) has promised that charges would not be increased by more than 10% year on year for the next five years, if the planned 148 percent increase in rate is approved. 

ECG has been chastised for demanding a 148 percent raise for the year 2022, but the business claims that it would help them dramatically cut losses.

“We are not faulting the Public Utilities Regulatory Commission [for not allowing us to increase tariffs over the years], but as a utility service provider, it is having a negative impact on our operations. Over the period, if you put these minimal increases together, you are getting a very wide gap between the prevailing tariffs and what we will call a cost recovery tariff. The tariff has reduced considerably”, says General Manager for Regulatory Management at ECG, Sylvia Noshie.

She was addressing at a PURC-sponsored stakeholders' consultation gathering for the multi-year comprehensive tariffs review.

The corporation claims that it will only be able to recoup its losses if its petition for an upward adjustment is accepted.

“In the last few years, the only quarter adjustments we had was on October 1, 2019, and it was just 0.47 percent. Unfortunately for us, the last tariff approved by the regulator saw a 14% reduction on the previous tariff of March 2018. This has been the pattern over the years. Usually, we will come up with our distribution cost and proposal, but what you get the Commission to approve is very minimal”, Slyvia Noshie explained.

Apart from requesting a 148 percent increase in tariffs for 2022, the Electricity Company of Ghana is also requesting that the PURC grant it permission to levy street light tariffs to users.

“The ECG is also proposing to the PURC to introduce a street light tariff. Studies by the Ministry of Energy estimate the cost of street lights to be 108.65 million dollars a year. Currently, on the bill, we all see the public light levy and that’s 30 percent of the actual cost.”

Source: ghananews.hrforum.uk

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