By: Sarah Baafi
President John Dramani Mahama has disclosed sweeping reforms in Ghana’s energy sector, revealing major financial savings, improved gas payment compliance, and a roadmap to stabilise nationwide electricity generation.
Delivering his 2026 State of the Nation Address at Parliament House on Friday, February 27, 2026 the President painted a stark picture of inefficiencies within the power distribution system, stating that only about 52 per cent of energy injected into the grid was effectively collected due to high commercial and technical losses.
He explained that distribution-level challenges, including system compression and revenue leakages, had significantly undermined the sector’s financial sustainability. Of the revenue collected, approximately 62% was used to service obligations to power producers and related entities, creating long-standing liquidity constraints.
President Mahama revealed that a recent Media and Policy Action report uncovered contracts and invoices linked to the energy sector amounting to approximately $500 million. He assured Parliament that government has since taken corrective steps and is now fully up to date on gas consumption obligations.
“Today, we are fully current on our gas payment commitments,” he said, dismissing claims that gas supplies had been halted. According to him, government has reached a comprehensive roadmap with partners to guarantee payment for all gas consumed going forward.
The President stressed that the new framework will support reliable nationwide electricity generation while ensuring that gas procurement and consumption remain financially sustainable.
He further announced that planned increases in certain gas-related levies have been reviewed and reduced, with additional policy measures expected next month, including the development of a gas processing and management framework under the Ministry of Energy and Green Transition.
In a major financial breakthrough, President Mahama disclosed that negotiations with nine Independent Power Producers (IPPs) have yielded immediate savings of $250 million and the restructuring of approximately $1 billion in legacy debt over a 36-month payment period.
“These agreements will be submitted to Parliament,” he said, adding that government is committed to transparency and legislative oversight in implementing the revised energy sector arrangements.
The President noted that the reforms form part of a broader national support programme aimed at restoring efficiency, reducing financial losses, and strengthening Ghana’s credibility with international partners in the energy space.
He maintained that stabilising the power sector remains central to economic recovery, industrial growth and investor confidence, assuring Ghanaians that government is determined to build a resilient and financially sustainable energy system.
