We did not apply year-on-year tariff increments because they were insignificant – PURC


Director of Research at the Public Utilities Regulatory Commission (PURC), Dr. Kofi Obutey has justified the Commission’s failure to pass on the quarterly review of electricity tariffs to consumers.

Since 2019, the PURC has not applied the automatic tariff adjustment for consumers to pay. This, the Electricity Company of Ghana (ECG) says has contributed to its recent demand for a 148% increment in tariff.

Speaking on Top Story, Wednesday, Dr. Kofi Obutey explained that the Commission has been undertaking automatic tariff adjustment, however, it was not implemented because the differences were insignificant.

“The Commission actually does the automatic adjustment on a quarterly basis but when the increase is so insignificant the Commission does not really pass it to consumers to pick up. I would not say that we’ve not been doing that, No. we have been doing, but just that maybe, if the increase is so insignificant, we leave it at where it is,” he said.

He noted however, that the PURC has decided that henceforth, it will pass on year-on-year increments to consumers irrespective of the rate.

He, therefore, urged consumers to expect a strict application of the automatic adjustment.

“Now, the Commission has decided that if they increase it even one percent on the quarterly basis, it will be passed on, so that would be applied effectively,” he added.

Meanwhile, ECG says it will reduce its debt to sales ratio by 20 percent, provided its proposal for 148% increment in tariff is approved.

The major power distributor also hopes to increase other incomes by 10 percent and ensure a 95 percent completion of all projects once its proposed tariff increment is approved.

“If the Commission approves our tariff, we have a plan, we know that there is a lot expected from us. We hope to reduce our debt to sales ratio to 20%. We hope to meet the PURC’s collection target of 98 percent, in terms of operational excellence, we would ensure that all projects would be at least 95 percent executed on time,” she stated.