By: Franklin ASARE-DONKOH
A D&D Fellow in Public Law and Justice at CDD-Ghana who doubles as KPMG Professor in accounting at the Fisher School of Accounting, a public intellectual and scholar-activist, Professor Stephen Kweku Asare known in the public space as Prof. Kwaku Azar has called on the John Mahama administration to come up with a more sustainable policies to address Ghana’s energy sector challenges.
According to Prof. Kwaku Azar, the one Ghana Cedi levy on a liter of petroleum, which is expected to raise between Gh¢5–6 billion—roughly 60% of this year’s estimated GH¢1.2 billion thermal fuel requirement may help avert blackouts, avoid steep electricity tariff hikes, and restore Ghana’s financial credibility with development partners.
However, the legal practitioner and governance commentator argued that the GHC1 levy placed on every liter of petrol, gasoline, and other fuels reduces the fuel purchasing power of ordinary citizens, adds fiscal pressure to households and businesses, and disproportionately affects the poor.
In a Facebook post, the good old professor explained that the debt-ridden power sector did not just happen, saying, “This crisis didn’t appear overnight. It is the result of inflated contracts, procurement abuse, weak financial discipline, and the misuse of previous energy levies. Without accountability, this levy will only reinforce a broken cycle.”
Prof. Kwaku Azar has thus proposed a Reform Blueprint containing a three-pronged framework for pairing the new levy with meaningful reforms as follows:
Accountability First
Launch a forensic audit into the past decade of energy spending.
Prosecute public and private actors involved in malfeasance.
Recover misappropriated funds and blacklist corrupt suppliers.
Transparent, Targeted Use
Ring-fence proceeds strictly for fuel procurement and debt repayment.
Mandate quarterly public reports on collections and expenditures.
Tie the energy sector SOE funding to performance metrics.
Structural Reform and Fiscal Discipline
Gradually adjust tariffs to reflect actual energy costs.
Renegotiate predatory Independent Power Producer (IPP) contracts.
Scale up renewable investments to reduce thermal reliance.
Make the levy time-bound and subject to measurable targets
Require parliamentary reauthorization every two years and cap levy rates unless independently justified.
Call to Action
“The levy may be necessary, but it is not sufficient,” Prof. Asare stressed. “We cannot be asked to tighten our belts while those who caused the looseness go free.”
He called for the Energy Ministry and the Finance Ministry to present a credible roadmap that restores both power supply and public confidence.
“This is not just about raising revenue. It is about restoring trust. We cannot levy our way out of inefficiency—and we cannot fix a broken system by pouring more money into it without fixing what broke it,” he concluded.
Background
The Energy Sector Levy (Amendment) Bill, 2025, introduces a GHS1 increase in the levy on petroleum products. The measure is expected to generate an additional GHS5.7 billion annually to reduce energy sector debts and ensure a reliable power supply.
The GH¢1 fuel levy, announced by Finance Minister Dr. Cassiel Ato Baah Forson, is part of the government’s effort to close a financing gap in thermal fuel procurement. While government sources insist the levy won’t raise fuel pump prices due to favorable exchange rates, the policy has stirred strong public debate.
But the Private legal practitioner and governance advocate is of the view that without proper accountability and structural reform, the policy risks becoming another bailout for elite failure.
In a detailed Facebook post titled “Pair the Levy with Reform & Accountability,” Prof. Kwaku Azar, acknowledged the urgent financial pressures facing Ghana’s energy sector, including a $3.1 billion debt burden, depleted World Bank and GNPC guarantees, and the rising cost of thermal fuel expenses that are not currently reflected in electricity tariffs.
“The government’s proposed amendment to the Energy Sector Levies Act (2025) is an attempt to stabilize the sector,” he noted. “The rationale is clear… but a critical pillar is missing.”
