Between 2025 and 2030, Ghana needs about US$4.4 billion in new energy investment to achieve its National Energy Compact target of 99% electricity access by 2030, an increase from the current level of roughly 89%. Out of this amount, US$2.6 billion is expected from private capital, while US$1.8 billion will be required from public and donor sources. The Multi-Year Tariff Order (MYTO) 2025–2030, which the Public Utilities Regulatory Commission (PURC) is currently consulting on, is more than a technical adjustment. It is a structural reform that may determine whether private capital flows into Ghana’s energy sector at scale or remains cautious.
What the myto is trying to solve
The MYTO aims to replace Ghana’s frequent, politically influenced tariff changes with a predictable five-year tariff framework for electricity and water. Utilities including ECG, VRA, GRIDCo and Ghana Water Ltd have submitted CAPEX and OPEX proposals for 2025–2030, and PURC is holding nationwide hearings to scrutinize these submissions.
Many of the requests are dramatic. Some utilities have proposed triple-digit tariff increases. ECG, for example, is reported to be seeking about a 239% increase in its distribution service charge. Other parts of the value chain may also see increases that translate to several hundred percent overall.
PURC, however, has not automatically validated these proposals. Recent quarterly tariff adjustments have been modest, mostly single-digit increases for electricity and in some cases no water tariff changes, while the larger structural questions are debated under MYTO. This represents PURC’s attempt to move from short-term firefighting to a structured, cost-reflective, multi-year tariff regime aligned with long-term national development.
Why this reform deserves real credit
From an investor and policy perspective, PURC is taking several commendable steps.
a) Moving toward predictability
A multi-year tariff pathway gives long-term investors the predictability they require. It allows utilities and IPPs to plan their balance sheets and investments over five years instead of reacting to quarterly political or FX-driven changes.
b) Opening the process to real stakeholders
PURC has taken MYTO on the road, holding public hearings in Kumasi, Koforidua, Sunyani, Ho and other regions. This inclusive engagement enhances legitimacy. Tariffs that will influence households, businesses and utility solvency must enjoy broad social acceptance.
c) Speaking the language of transparency and cost recovery
PURC leadership has emphasized the need for a resilient, transparent and financially sustainable utility ecosystem. This type of regulatory signalling builds investor confidence and helps shift tariffs from political decisions to financial instruments.
The benchmark: what sophisticated tariff regimes actually do
Globally, multi-year tariff systems typically include clear cost-of-service principles, predictable adjustment formulas for FX, fuel and inflation, annual minor reviews and major multi-year reviews, performance-based incentives, strong revenue collection and creditworthy off-takers. Ghana does not need to invent a new model; it simply needs to align MYTO with these proven pillars.
Where myto must go further
For Ghana to successfully mobilize US$2.6 billion in private capital, MYTO must address long-standing structural weaknesses.
Revenue collection and sector creditworthiness
Revenue weakness remains the sector’s biggest challenge. Even with cost-reflective tariffs on paper, utilities cannot meet obligations to IPPs or repay debt if collections remain poor. High losses, weak revenue protection and persistent arrears have undermined past reforms.
Investors care less about tariff levels and more about whether those tariffs convert into stable cash flows. MYTO must therefore integrate loss-reduction targets, collection-rate benchmarks and ring-fenced escrow mechanisms that secure IPP and transmission revenue. Without these, the perceived risk of the sector will remain high.
Treatment of legacy arrears
Ghana enters the MYTO period with legacy debt and unpaid obligations. Without transparent resolution — including securitization, restructuring or a bad-bank model — new investors may feel they are joining a long queue of unpaid creditors.
Calibrating tariff increases with social protection
Some utilities have proposed very steep tariff increases, raising concerns among labour groups, businesses and consumers. The challenge is to balance utility solvency, consumer welfare and political stability. International best practice shows that gradual implementation, lifeline tariffs and clear communication about service improvements are essential for public acceptance.
What investors will be watching for
Private investors, DFIs and IPPs assessing Ghana’s energy sector will monitor whether the MYTO methodology is transparent and stable, FX and fuel pass-through mechanisms are formula-based, loss-reduction and collection improvements are mandatory, legacy arrears are structurally resolved and the government protects the regulator’s independence. Positive signals in these areas will indicate that Ghana is ready to receive the US$2.6 billion it is targeting between 2025 and 2030.
Commendations with a clear challenge
PURC deserves credit for initiating a transparent multi-year tariff framework. However, MYTO must deliver on three critical commitments simultaneously: financial sustainability for utilities and IPPs, social legitimacy for consumers and businesses, and regulatory predictability strong enough to anchor long-term private capital. Meeting these conditions is essential to transforming Ghana’s National Energy Compact goals — US$4.4 billion in required investment and 99% electricity access by 2030 — from aspiration into reality.
The MYTO debate is ultimately not only about tariffs. It is about whether Ghana can finally align pricing, policy and capital in a way that ensures reliable power, expands access and attracts the scale of private investment the country urgently needs.
Writer: Nicholas Solomon
(Infrastructure and Real Estate Investment Professional)
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