President-elect John Dramani Mahama has raised serious concerns about the governance of the Electricity Company of Ghana (ECG), citing the unsustainable levels of commercial and technical losses that currently exceed 32%. He emphasized that these alarming losses pose a significant threat to the stability of Ghana’s energy sector and must be addressed immediately to safeguard the country’s energy future.
Speaking on the issue, Mahama underscored the severity of the problem, warning that failure to address these inefficiencies could undermine progress achieved through the debt exchange programme and the ongoing International Monetary Fund (IMF) agreement. According to him, the growing debts within the energy sector, exacerbated by ECG’s current operational challenges, could derail Ghana’s broader economic recovery and financial stability.
“The energy sector can derail everything that we have done with regard to the debt exchange and with regards to the IMF programme because debt continues to pile up there. ECG’s governance is in a very bad way and so they are making commercial and technical losses of more than 32 per cent,” Mahama stated.
The President-elect stressed that no utility company could remain viable while sustaining such staggering losses. He pointed out that the inability to control commercial and technical inefficiencies within the electricity distribution system jeopardizes ECG’s long-term survival and Ghana’s energy sector as a whole. Mahama called for comprehensive reforms across the electricity value chain to resolve the issue swiftly and ensure stability.
“No utility company can survive with 32% of technical and commercial losses and continue to be a viable utility. So as quickly as possible, we need to do reforms in the whole electricity value chain,” he reiterated.
The growing inefficiencies at ECG come at a time when Ghana is striving to meet its financial obligations through various economic recovery initiatives, including the IMF programme. These reforms were designed to stabilize the economy and address the mounting public debt. However, Mahama cautioned that if ECG’s losses remain unchecked, they could significantly undermine the country’s economic progress, as debt continues to accumulate within the energy sector.
ECG’s commercial losses refer to revenue shortfalls arising from nonpayment, illegal connections, and billing inaccuracies, while technical losses stem from energy that is dissipated during transmission and distribution due to infrastructural inefficiencies. Combined, these losses represent a significant portion of the company’s total output, ultimately affecting its financial health and ability to deliver reliable electricity to Ghanaians.
The President-elect’s call for reforms comes as a direct response to the critical challenges facing Ghana’s energy sector. Over the years, the ECG has struggled to balance operational costs with revenue generation, resulting in growing debts that burden the country’s economy. Mahama believes that without immediate action, these structural inefficiencies will only deepen, leading to further instability across the energy sector.
The debt exchange programme and IMF agreement are vital components of Ghana’s broader economic recovery plan. These measures were introduced to ease the country’s debt burden, stabilize the economy, and promote sustainable growth. However, Mahama’s concerns highlight the fragility of this recovery effort, particularly in light of the persistent challenges within the energy sector. The accumulation of debts in the energy value chain not only threatens ECG’s viability but also risks undoing the progress achieved through these critical economic reforms.
As part of his vision for Ghana’s energy sector, Mahama has consistently emphasized the need for systemic reforms to address the inefficiencies within the electricity supply and distribution chain. He believes that implementing reforms will ensure ECG operates efficiently, reduces losses, and contributes meaningfully to the country’s energy security. By addressing the governance challenges and improving operational efficiency, Mahama hopes to create a sustainable and financially stable energy sector that serves the needs of all Ghanaians.
The President-elect’s concerns also reflect the broader implications of ECG’s inefficiencies on Ghana’s economic landscape. The energy sector plays a critical role in driving economic growth, supporting industries, and improving the quality of life for citizens. Persistent challenges within the sector, such as energy shortages, high costs, and unreliable power supply, can have far-reaching consequences on the country’s economic development. Mahama’s call for reform underscores the urgency of tackling these challenges to ensure the energy sector becomes a driver of economic progress rather than a hindrance.
In addition to highlighting ECG’s inefficiencies, Mahama’s remarks point to the need for stronger governance and accountability within the company. He believes that addressing governance-related challenges will pave the way for more effective management practices, improved revenue collection, and reduced losses. These efforts will not only benefit ECG but also strengthen Ghana’s energy infrastructure, making it more resilient and capable of meeting the demands of a growing population.
As Ghana continues to navigate its economic recovery, Mahama’s call for reforms serves as a timely reminder of the importance of prioritizing the energy sector. He believes that addressing the systemic issues within ECG will not only secure the country’s energy future but also bolster Ghana’s economic resilience. The President-elect’s focus on reforming the electricity value chain reflects his commitment to delivering reliable, affordable, and sustainable energy to all Ghanaians.
The energy sector remains a critical pillar of Ghana’s economic development, and Mahama’s emphasis on reform is a step toward addressing the long-standing challenges facing ECG. By reducing commercial and technical losses, improving governance, and implementing systemic reforms, Ghana can achieve a more efficient and financially stable energy sector that supports national development goals.
Mahama’s call to action signals the urgency of addressing ECG’s challenges before they spiral further out of control. The President-elect remains optimistic that with the right policies and reforms, Ghana’s energy sector can be transformed into a reliable and sustainable resource for the country. His focus on accountability, efficiency, and innovation highlights the need for a coordinated effort to overcome the current challenges and secure Ghana’s energy future.
As Ghana prepares for the next phase of its economic journey, Mahama’s vision for the energy sector will play a crucial role in shaping the country’s progress. The President-elect’s commitment to reforming ECG reflects his determination to tackle the root causes of inefficiency and create a stronger foundation for Ghana’s energy sector. By addressing these challenges head-on, Mahama hopes to build a more resilient, efficient, and prosperous energy sector that benefits all Ghanaians.
In the face of mounting challenges, Mahama’s leadership offers a path forward. His call for urgent reforms serves as a rallying cry to stakeholders across the energy sector to work together toward a common goal: ensuring the sustainability and stability of Ghana’s energy supply. With decisive action and a shared commitment to progress, Ghana can overcome its energy challenges and pave the way for a brighter future.
