With a little over one month left for the first quarter of 2026 to draw to a close, a heavy cloud of anxiety hangs over Ghana’s private sector. If the Public Utilities Regulatory Commission (PURC) proceeds with another upward adjustment in electricity tariffs during its upcoming quarterly review, it may trigger an economic “perfect storm” that businesses and households are ill-equipped to weather. The warning signs are already flashing; following a significant hike in January 2026, any further increase at the end of March would mark a relentless trend of rising power costs. Industry experts warn that the cumulative effect of these quarterly reviews is no longer just a price adjustment—it is becoming a terminal barrier to business survival.
The Biting Effect on Industry and Business
For Ghana’s manufacturing and industrial hubs, electricity is not just a utility; it is the lifeblood of production. Businesses are already gasping for air as utility costs go up. In January, electricity inflation surged far outpacing the national average, serving as a clear warning that the cost of power is getting out of control. According to the Ghana Statistical Service, electricity and gas prices nearly doubled from 6.1% in December 2025 to 14.8% in January, on year-on-year basis. The biting effect is being felt across all sectors, from manufacturing factories seeing their production costs soar to the tourism and hospitality industry where hotels and restaurants find their margins vanishing under the weight of refrigeration and cooling costs. Most critically, the government’s flagship 24-Hour Economy policy faces its biggest hurdle, as the lack of affordable “night-shift” power removes the incentive for businesses to run third shifts, potentially stalling the entire job-creation initiative.
A Pattern of Pain: The IMF Conditionality
While many point the International Monetary Fund (IMF) bailout conditions as the reason for these “cost-reflective” tariffs, the social and economic cost is telling. Under the $3 billion Extended Credit Facility, Ghana is required to restore the financial viability of its energy sector through regular price adjustments. However, the reality on the ground shows that the “viability” of state energy companies is currently coming at the total expense of the citizens’ and businesses’ viability. Complaints from individuals are beginning to surge.
The Urgent Need for a “Relook” and Cheaper Energy
There is now a loud, urgent call for the government to re-evaluate the fundamental cost of energy. If tariffs remain on this upward trajectory, companies will continue to struggle, and many may be forced to shut down or relocate to neighboring countries with more competitive power rates. To prevent this, the government must move quickly into cheaper forms of energy, shifting away from expensive thermal power toward more sustainable and affordable renewables. There is an immediate need to keep electricity tariffs within manageable levels to ensure that manufacturing, tourism, and the 24-hour economy do not collapse under the weight of utility inflation.
The Bottom Line
The fact that electricity inflation of 14.8% remains significantly higher than the national producer price inflation average of 1.6%, is proof that the current trajectory is unsustainable and requires far-reaching solutions. Without a strategic shift toward lower generation costs and industrial-friendly pricing, the “multiple trouble” sparked by the next tariff hike could set Ghana’s broader economic recovery back by years.
