Scrapping the GH₵1 fuel levy could trigger fresh economic strain and undermine energy sector stability, Energy and Green Transition Minister John Abu Jinapor has cautioned amid mounting public pressure to abolish the charge.
Appearing before Parliament’s Governance Assurance Committee on Tuesday, the Minister said government was fully aware of the pressure the levy placed on consumers but insisted that removing it without a reliable alternative would only deepen the country’s economic challenges.
He warned that Ghana could not afford to take decisions based on public pressure alone, stressing that what may appear to be immediate relief could create far more severe problems in the long term.
“We must not take populist decisions that will further hurt the economy,” he said, adding that once the energy sector loses financial stability, restoring it would be extremely difficult and costly.
Mr. Jinapor explained that the levy, introduced in 2025 under the Energy Sector Levies (Amendment) Act, was meant to help government address the long-standing debts in the energy sector and protect the country from recurring power crises.
According to him, the policy was designed not just as a revenue measure but as a safeguard against another period of unstable electricity supply.
He cautioned that scrapping the levy without a solid replacement plan could weaken the progress made in stabilising the power sector and also damage investor confidence at a time when the country is trying to attract more private investment into energy.
The Minister also pointed to lessons from the COVID-19 period, when government absorbed the cost of free electricity for households in 2020.
Although the decision brought temporary relief to millions of Ghanaians, he said the financial burden eventually had to be borne by the economy.
“That experience shows that even well-intentioned decisions can have serious long-term consequences,” he said.
Mr. Jinapor acknowledged public frustration over rising fuel prices, which continue to be affected by global market pressures and geopolitical tensions in the Middle East.
However, he stressed that the country must balance short-term relief with long-term economic stability.
He disclosed that the Ministry of Energy was currently engaging the Ministry of Finance and other stakeholders to assess whether the levy could be reviewed or replaced with a more sustainable funding option.
Any decision, he said, would be based on economic realities rather than short-term political pressure.
The Minister urged Ghanaians to support responsible and carefully considered economic policies, stressing that protecting the stability of the energy sector was crucial to safeguarding jobs, businesses, and reliable electricity supply across the country.
