The Managements of the Electricity Company of Ghana and the Ghana Water Company Limited have indicated that they are overburdened with operational costs, therefore, struggling to survive.
They outlined that an increase in the dollar exchange rate, inflation, pollution among others contribute to the high operational cost hence their proposal for tariff increments of 148% for electricity and 344% for water.
The utility service providers made these known at a public hearing organised by the Public Utilities Regulatory Commission (PURC) in the Volta Regional capital of Ho.
The General Manager of the Regulatory Management of ECG, Sylvia Noshie, noted that “ECG is currently a struggling distribution company that requires urgent support” therefore the need for a full cost recovery tariff proposal.
“If you consider the impact of the macroeconomic variables, what it means is that our inadequate distribution service charge, has now diminished, it has dwindled…and this has impacted ECG’s operation. Now the prevailing tariffs as it stands now do not satisfy the cost of distribution these days.
In our entire proposal, it is only on the DSC one, which we are saying, has increased by 148,” she said. According to her, ECG is also proposing a street light tariff as a means to raise revenue to defray expenses on street lights.
“People are erecting street lights every now and then, so it means that, as a utility, for us to account for our energy sales, which if we don’t, will translate into system loss for us, we need to continuously or regularly go to the fields to account for the street lights which are in place and we often would have to submit the cost of these street lights, maybe to the ministries and they are interested in knowing whether you have calculated the costs well, using the appropriate tariff,” she explained.
On his part, the Manager, Corporate, Planning, Monitoring and Evaluation of GWCL, Seth Atiapah, noted that the proposed tariff increment is because of the high cost of production due to pollution, maintenance, debt overhung, inflation and depreciation of the cedi.
He also used the opportunity to sensitize the audience to desist from polluting the water bodies so as to save the cost of money used on chemicals for purification.
“What do you push into the water bodies? Your homes, when we finish all our things, where do you throw the water away?” “If we continue to do it, the water we extract becomes dirtier and that will require more money to treat it, because we will buy more chemicals. And this is what has happened to us. Even in some cases, the pollution in the water has made it to be untreatable,” he said.
Meanwhile, participants lamented the proposal of the utility services for an upward adjustment in tariff. According to them, the proposed tariffs should be reduced considering the hardship in the country.
Commenting on this, the Executive Secretary of PURC, Ishmael Ackah, stated that PURC will further engage the public before issuing its recommendation.
He added that by July 1, they should be able to come up with a decision.
“We will look at the numbers and come up with a tariff and when we come out, every quarter, we look at macroeconomic factors, especially exchange rate, inflation and the cost of fuel. Then we can do some minor adjustments to the figures by June 14, we should complete all engagement,” he said.