Ghana’s Independent Power Generators have welcomed the government’s new GH₵1 Energy Sector Levy, but have warned that the funds must be transparently managed this time, after years of financial mismanagement that left the country’s power sector on the brink of collapse.
In a statement, the Independent Power Generators, Ghana (IPGG), backed the levy as a “pragmatic and forward-looking measure” to tackle the crippling debt now plaguing the electricity value chain. However, the association stressed that the levy must be ring-fenced, strictly monitored, and used with full transparency, a clear message to government agencies that past mistakes cannot be repeated.
“The current accumulation of debt, now significantly compounded and overdue, was entirely avoidable,” said Dr. Elikplim Kwabla Apetorgbor, Chief Executive Officer of IPGG. “The sector’s distress is a direct consequence of the mismanagement and misapplication of previously established Energy Sector Levy and bond proceeds and loans.”
Funds that had been earmarked to pay off legacy debts and stabilise the power sector were not applied with “the discipline, transparency, and accountability that the sector required,” the statement noted. This failure has now left power producers, fuel suppliers, and other players in the electricity ecosystem unable to recover costs, maintain generation assets, or secure timely fuel supplies.
“The entire power delivery ecosystem is under immense strain,” Dr. Apetorgbor warned. “This situation undermines grid stability, endangers electricity reliability, and diminishes confidence among investors and financial partners.”
In this context, the IPGG commended the current administration for recognising the urgency of the crisis and initiating corrective action through the new levy. But they made it clear that public trust in the use of these funds must be rebuilt.
“We acknowledge the genuine burden any new levy places on consumers, especially under current economic conditions. However, the consequences of inaction, which could be blackouts, plant shutdowns, job losses, and erosion of national productivity are far more severe and immediate,” Dr. Apetorgbor said.
The IPGG has called on all Ghanaians to support the measure in good faith but urged government to prove its commitment to transparency by ensuring that the proceeds are used solely to restore liquidity and credibility in the sector.
“We stand ready to collaborate with government and all stakeholders to ensure that the proceeds are effectively utilised and that the sector is placed on a path of financial sustainability, operational efficiency, and long-term resilience,” Dr. Apetorgbor concluded.
The GH₵1 Energy Sector Levy is the latest in a series of policy interventions aimed at pulling Ghana’s struggling power sector back from the brink.
