The Public Utilities Regulatory Commission (PURC) has disclosed that electricity and water tariffs for the first quarter of 2023 would be increased by 29.96 percent and 8.3 percent respectively effective February 1, 2023.
The Commission revealed this after it concluded its regulatory process for the quarterly adjustment of utility tariffs this year as part of its mission to track and make changes in natural gas, electricity, and water tariffs.
According to PURC, the decision to increase the various utility tariffs was based on the dollar and cedi exchange, inflation, generation mix, and the weighted average cost of natural gas.
The Regulatory Commission said these key variables underlying the rate setting, have changed significantly since the major tariff was announced in August 2022 highlighting examples where the weighted average Ghana cedis US Dollar exchange rate used for the major tariff review was GH₵7.5165 to the US Dollar.
A release signed by Dr. Ishmael Ackah, the General Secretary of PURC indicated that the average weight of the Ghana Cedi US Dollar exchange rate used in the first quarter of this year was GH₵10.5421.
The statement added that the depreciation of the cedi and inflation has impacted the system leading to the under-recovery of the utility companies, therefore, the companies required an upward adjustment in their tariffs in order to keep the lights on and the water flowing in the country.
“The PURC is equally mindful of the current difficult economic circumstances but notes that the potential for outages would be catastrophic for Ghana and has to be avoided. The PURC, therefore, sought to balance prevention of extended power outages and its deleterious implications on jobs and livelihoods with minimizing the impact of rate increases on consumers”.
“The Commission, therefore, decided to increase the average end-user tariff for electricity by 29.96% across the board for all consumer groups (Table i). The average end-user tariff for water has also been increased by 8.3% (Table 2). The Commission, however, approved varying rate adjustments including some reductions for selected industrial and commercial consumers as part of the ongoing restructuring of the existing water rate structure”, a portion of the statement read.
The PURC further expressed its gratitude to all stakeholders for their support in implementing quarterly tariff reviews in accordance with its Rate Setting Guidelines for Quarterly Review of Natural Gas, Electricity, and Water tariffs.
“In doing so, the Commission will continue to equitably balance the interests of the utility service and consumers and hold service providers to strict adherence to regulatory standards and benchmarks,” PURC assured.
Read full statement below
