Businesses in Ghana would have to brace themselves for a double challenge as both power cuts and rising utility tariffs loom on the horizon. With gas supply disruptions already affecting power generation and an imminent tariff increase, companies will need to prepare for operational turbulence.
A recent press release from GRIDCo and the Electricity Company of Ghana (ECG) revealed that gas supply shortage at the Ghana National Gas Limited (GNGC) Gas Processing Plant has led to intermittent power outages across the country.
This shortage, which is affecting power generation, has impacted businesses that rely heavily on consistent electricity supply for longer hours. These interruptions have resulted in reduced productivity, delayed operations, and increased demand for backup power solutions like generators.
For businesses, particularly those in manufacturing or cold-store business , these power cuts can lead to operational inefficiencies. The added cost of mitigating the effects of these power outages, such as investing in alternative power sources, has further strained businesses’ operational budgets.
Adding to this burden, electricity and water tariffs are set to rise by 3.02% and 1.86% respectively from Tuesday, October 1, 2024. These increases compound the difficulties businesses are already grappling with due to the ongoing power shortages.
For companies still trying to cope with inconsistent electricity supply, the new tariffs will mean paying more for an unreliable service. This will likely force energy-intensive sectors like manufacturing to either reduce operations or pass on the additional costs to consumers, potentially leading to price increases across the board.
Small and medium-sized enterprises (SMEs), which are the backbone of Ghana’s economy, are especially at risk. Many lack the financial resources to invest in alternative energy sources such as generators or solar power, meaning they will bear the brunt of both the tariff increases and the power outages.
For these businesses, the combination of higher costs and unreliable electricity could result in decreased productivity, potential layoffs, or even closures if they are unable to absorb these rising costs.
