{"id":244247,"date":"2022-05-12T09:10:09","date_gmt":"2022-05-12T09:10:09","guid":{"rendered":"https:\/\/www.gbcghanaonline.com\/?p=244247"},"modified":"2022-05-12T14:42:42","modified_gmt":"2022-05-12T14:42:42","slug":"approve-144-tariffs-hike-now-or-risk-paying-more-in-2024-ecg-cautions","status":"publish","type":"post","link":"https:\/\/www.gbcghanaonline.com\/general\/approve-144-tariffs-hike-now-or-risk-paying-more-in-2024-ecg-cautions\/2022\/","title":{"rendered":"Approve 144% tariffs hike now or risk paying more in 2024 \u2013 ECG cautions"},"content":{"rendered":"

By: Sani Abdul-Rahman<\/span><\/b><\/p>\n

The Electricity Company of Ghana<\/a> (ECG) has warned that failure to approve its proposed tariff hike would result in significant tariff increment in the next few years.<\/span><\/p>\n

In a proposal to the Public Utility Regulatory Commission (PURC), the state power distributor wants its distribution service charge increased by 144% and the adjustment to cover the period 2019 and 2022. <\/span><\/p>\n

The DSC\u00a0<\/span>is the margin for power distributors to recover the cost of distribution network operations.<\/span><\/p>\n

ECG warned that failure to grant its request would undermine its financial sustainability and ability to address the company\u2019s inefficiencies.<\/span><\/p>\n

\u201cI can assure you that in the next three years, if we are asked to propose tariffs, it will contain this 148% plus other factors. So, we will be looking at something much higher”.<\/span><\/p>\n

\"Approve<\/p>\n

ECG\u2019s <\/span>General Manager for Regulatory Management, Sylvia Norshie said in a presentation at a Multi-Stakeholder Meeting on Tariff Review in Accra.<\/span><\/p>\n

The power company argued that tariffs approved since 2019 were not cost-reflective and have led to an increase in its debt levels.<\/span><\/p>\n

But once granted, the proposed 144% increase annual tariff hikes would not exceed 10% in the medium term, according to ECG\u2019s proposal.\u00a0<\/span><\/p>\n

Basis for proposed tariffs hikes<\/span><\/b><\/p>\n

 <\/p>\n

\"Approve<\/p>\n

The power distributor argues that the prevailing tariff (14% lower) has exceeded its stipulated regulatory timeframe thus affecting its revenue drive.\u00a0<\/span><\/p>\n

Macroeconomic factors such as inflation (23.6% for April 2022) and exchange rate volatilities have compounded the challenges facing ECG. The cedi has lost more than 15% against the dollar this year.<\/span><\/p>\n

The utility provider targets to achieve full cost recovery as well as the cost of projects completed.<\/span><\/p>\n

\u201cThere is a wide gap between the prevailing tariff and the actual full cost recovery tariff. We need to bridge this gap,\u201d Sylvia Norshie told the gathering.<\/span><\/p>\n

ECG targets efficiency<\/span><\/b><\/p>\n

The company projects to achieve 98% of its revenue target and a 10% increase from non-tariff sources.<\/span><\/p>\n

Regarding debt-to-sales ratio, which measures how much a business owes against its revenue, ECG targets to reduce it by 20% if its proposed tariff hike is approved.<\/span><\/p>\n

CLICK HERE FOR MORE GENERAL NEWS<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By: Sani Abdul-Rahman The Electricity Company of Ghana (ECG) has warned that failure to approve its proposed tariff hike would result in significant tariff increment in the next few years. In a proposal to the Public Utility Regulatory Commission (PURC), the state power distributor wants its distribution service charge increased by 144% and the adjustment […]<\/p>\n","protected":false},"author":4,"featured_media":228608,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[22],"tags":[4237,4863],"acf":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/i0.wp.com\/www.gbcghanaonline.com\/wp-content\/uploads\/2021\/12\/ECGG.png?fit=600%2C336&ssl=1","jetpack-related-posts":[],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/posts\/244247"}],"collection":[{"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/comments?post=244247"}],"version-history":[{"count":0,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/posts\/244247\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/media\/228608"}],"wp:attachment":[{"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/media?parent=244247"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/categories?post=244247"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gbcghanaonline.com\/wp-json\/wp\/v2\/tags?post=244247"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}