PURC HIKES TARIFFS

Posted on: www.dailyguideghana.com

By William Yaw Owusu

Monday, December 07, 2015

The Public Utilities Regulatory Commission (PURC) is set to introduce new tariffs for utilities, commencing today, barring any hitch.

It is coming in the wake of a protracted energy crisis known as dumsor, which has spanned over three years, together with perennial water shortages in many communities of the country.

DAILY GUIDE learnt that electricity is most likely to see an astronomical increment around 100 percent while water will increase between 50 and 80 percent. In all, the tariff adjustment is within the range of about 200 per cent for ECG, VRA, GRIDCo and Ghana Water.

It is rumoured that it is the Mahama-led NDC government which is surreptitiously putting pressure on the utilities regulator to increase the tariffs at a time when Ghanaians are experiencing one of the harshest economic conditions.

The PURC is said to be bracing itself for the announcement by first sensitizing the media who would then explain its action to the public.

Trades Union Congress (TUC) and the Association of Ghana Industries (AGI) are said to have protested vehemently at the increment but to no avail.

Fuel For Barge

It is emerging that the increment has become imminent because the government badly needs money to buy crude for the power barge which has arrived from Turkey.

Some experts are pointing out that if it was tariff hike the PURC needed, then it should not have waited for dumsor to wreak havoc on the economy before taking such drastic steps.

Several businesses have collapsed as a result of the biting power crisis, the worst in the country’s history, leading job cuts.

It is now becoming clearer that it is the public that is going to pay to fuel the power barge – about which government propagandists had been making a lot of noise.

Deputy Power Minister, John Jinapor, set the tone recently in Tamale when he said that Ghanaians would have to pay more for energy supply when the power barge government was renting hit town.

The government’s behind-the-scenes dealing with the PURC came to the fore in October when the threat to cut gas supply to the Volta River Authority (VRA) by Nigeria Gas (N-Gas) reached a crescendo.

In the ensuing confusion, Managing Director of West Africa Gas Pipeline (WAPCo), Walter Perez, said cabinet had already directed the PURC to approve the increment of tariffs to enable the service providers to settle $182 million debt to N-Gas.

It was reported at the time that the government owed Electricity Company of Ghana (ECG) GH¢1.5 billion and VRA over GH¢1 billion.

The VRA was said to owe WAPCo $103 million with the balance of $78 million being owed to N-Gas and the other parties in the gas supply chain.

“It’s a tough decision for the president to make because ultimately it will mean that the consumer will have to pay more for power...If he is not able to do that and the country is not able to do that then things really will fall apart,” Walter Perez said at a press conference.

Currently, the VRA is reported to have lost about 450 megawatts of power in the Tema enclave alone due to lack of funds to buy crude to power the plants hence, the recent intensified load shedding.

Water Rationing

Ghana Water has also resorted to rationing of water in most communities because of cost of production.

The recently commissioned Teshie-Nungua Desalination Plant is owed GH¢43 million by Ghana Water Company for the supply of treated sea water to the communities around the project area.

The operators of the plant threatened to shut it down for the non-payment of the debt.

Ghana Water is demanding over 100 per cent tariff adjustment.