The Independent Power Generators, Ghana (IPGG), has thrown its support behind the government’s introduction of the GHS1 Energy Sector Levy, describing it as a necessary and urgent measure to address the country’s growing energy sector debt.
The GHS1 levy on fuel, recently approved by Parliament as part of the Energy Sector Levy (Amendment) Bill, 2025, is intended to generate additional revenue to clear outstanding debts in the power sector and ensure a more stable electricity supply across the country.
In a statement released on Thursday, June 5, the Chief Executive Officer of IPGG, Dr. Elikplim Kwabla Apetorgbor, said the levy was crucial to restoring financial stability within the power sector.
He attributed the current financial distress in the sector—affecting power producers, fuel suppliers, and system reliability—to what he described as the mismanagement and misapplication of previously established energy sector levies, bond proceeds, and loans.
“This policy intervention is both necessary and time-sensitive, given the precarious financial state of the sector. It must be stated with clarity and conviction that the current accumulation of debt, now significantly compounded and overdue, was entirely avoidable. The sector’s distress, which affects power producers, fuel suppliers, and system reliability, is a direct consequence of the mismanagement and misapplication of previously established Energy Sector Levy and bond proceeds and loans.”
His support follows the passage of the Energy Sector Levy (Amendment) Bill, 2025 by Parliament. The bill introduces a GHS1 increase per litre of fuel, a move projected to generate GHS5.7 billion annually. These funds are earmarked to settle mounting debts in the energy sector and ensure a consistent power supply across the country.
Finance Minister Dr. Cassiel Ato Forson revealed that Ghana’s energy sector currently faces a debt burden of $3.1 billion, with an estimated $3.7 billion required to fully clear all arrears. Additionally, the government needs $1.2 billion to procure fuel for thermal power generation in the year 2025 alone.
Dr. Forson described the levy as a lifeline for the country’s electricity infrastructure, pointing out that energy producers depend on timely payments to operate.
Read below the statement issued by IPGG
FOR IMMEDIATE RELEASE
June 5, 2025
THE INTRODUCTION OF GHS1 ENERGY SECTOR LEVY IS A NECESSARY MEASURE TO RESTORE STABILITY IN THE POWER SECTOR
- The Independent Power Generators, Ghana (IPGG), extends its firm support for the Government of Ghana’s introduction of a GHS1 Energy Sector Levy, aimed at addressing the growing and unsustainable debt within the electricity value chain. This policy intervention is both necessary and time-sensitive, given the precarious financial state of the sector.
- It must be stated with clarity and conviction that the current accumulation of debt, now significantly compounded and overdue, was entirely avoidable. The sector’s distress, which affects power producers, fuel suppliers, and system reliability, is a direct consequence of the mismanagement and misapplication of previously established Energy Sector Levy and bond proceeds and loans. Funds that were earmarked for the settlement of legacy debts and restoration of financial health were not applied with the discipline, transparency, and accountability that the sector required.
- As a result, the entire power delivery ecosystem is now under immense strain. Independent Power Generators (IPGG) are unable to recover costs, maintain assets, or secure timely fuel supplies, a situation that undermines grid stability, endangers electricity reliability, and diminishes confidence among investors and financial partners.
- In this context, IPGG commends the current administration for taking responsibility and initiating decisive, corrective actions. The introduction of GHS1 levy is a pragmatic and forward-looking measure. If properly ring-fenced, monitored, and applied transparently, it can serve as a credible instrument for restoring liquidity and credibility in the power sector.
- We acknowledge the genuine burden any new levy places on consumers, especially under current economic conditions. However, the consequences of inaction blackouts, plant shutdowns, job losses, and erosion of national productivity are far more severe and immediate. Ensuring a stable and resilient electricity supply is a shared responsibility that requires collective sacrifice and institutional accountability.
- IPGG therefore appeals to all Ghanaians to support this measure in good faith. We stand ready to collaborate with the government and all stakeholders to ensure that the proceeds are effectively utilized, and that the sector is placed on a path of financial sustainability, operational efficiency, and long-term resilience.
- Signed,
Dr. Elikplim Kwabla Apetorgbor
Chief Executive Officer
Independent Power Generators, Ghana (IPGG)
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Meanwhile, commercial transport operators have threatened to embark on a nationwide strike on June 10, 2025, in protest against the newly introduced GHC1.00 levy on petroleum products, popularly referred to as the “Dumsor Levy.”
Addressing the press on Thursday, June 5, the Industrial Public Relations Officer of the Ghana Private Road Transport Union (GPRTU), Abass Ibrahim Imoro, expressed strong dissatisfaction with the levy, describing it as a measure that will bring untoward hardship to commercial drivers and transport business owners across the country.
According to him, the decision to implement the levy was taken without adequate consultation and risks pushing many operators out of business due to rising operational costs.
The association has demanded an immediate reversal of the policy and a broader engagement with the government and relevant stakeholders.
“We are therefore calling on the government to reverse the levy immediately and engage us and stakeholders on the way forward. In the event that our call is not heeded, we will be compelled to take industrial action and park our vehicles on June 10, 2025. We urge the government to consider the impact of the levy on the transport sector and the consequences of our action on the economy, and engage us in meaningful deliberations to help address challenges in the energy sector,” he said.
The introduction of the levy follows the recent approval of the Energy Sector Levy (Amendment) Bill, 2025, by Parliament. The bill imposes a GHS1 increase in the levy on petroleum products and is expected to generate an estimated GHS5.7 billion in revenue.
According to Finance Minister Dr. Cassiel Ato Forson, the revenue will be used to reduce the country’s ballooning energy sector debt, which currently stands at $3.1 billion. He added that an additional $1.2 billion will also be needed to procure fuel for thermal power generation in 2025.
