Ghana’s ambition to build a globally competitive iron and steel industry will remain out of reach unless the country tackles the high cost of electricity.
This is the view of the former Minister for Power, Dr. Kwabena Donkor, who argues that affordable and reliable power is the single biggest factor determining whether Ghana can successfully establish an integrated iron and steel industry capable of adding value to the country’s vast mineral resources and driving industrialisation.
Speaking in an interview with veteran journalist Kwesi Pratt Jr., Dr. Donkor argued that no country has built a strong heavy industrial base without deliberately ensuring that energy-intensive industries receive competitively priced electricity.
“In most jurisdictions, they either dedicate the lowest-cost source of power to refineries or provide state support through power subsidies. Until we resolve the power issue and the cost of power to industry, we cannot have an integrated iron and steel industry,” he remarked.
Dr. Donkor, who also chairs the Technical Committee of the Ghana Integrated Iron and Steel Development Corporation, said efforts are underway to operationalise mines and establish processing facilities. However, he stressed that these investments will struggle to succeed if electricity costs remain prohibitively high.
Experts say heavy industries such as steel, aluminium and mineral refining consume enormous amounts of electricity, making power prices a decisive factor in determining whether local production can compete with imports.
When energy costs are high, manufacturers either pass the burden onto consumers through higher prices or scale back production, reducing their competitiveness.
The former Power Minister said this explains why countries pursuing industrialisation often reserve their cheapest power sources for strategic industries, enabling manufacturers to produce at lower costs, expand output and compete in international markets.
Dr. Donkor suggested that Ghana should objectively assess all viable power generation options, including clean coal technology, if doing so can lower electricity costs for industry. He maintained that the country’s energy policy should be guided by economic realities and national development priorities rather than external pressure.
“If the economics show that clean coal will provide cheaper electricity, we should consider it,” he said, noting that modern technologies significantly reduce pollution compared with traditional coal-fired plants.
He further proposed dedicating hydroelectric power from the Akosombo Dam to energy-intensive industries while alternative generation sources meet other demand, arguing that such an approach could unlock Ghana’s industrial potential.
Beyond steel production, Dr. Donkor believes affordable electricity is central to Ghana’s broader industrial transformation agenda. He noted that sectors such as aluminium, bauxite processing and mineral refining all depend on abundant, low-cost power to thrive.
With construction activity accelerating and demand for steel products continuing to rise, he argued that Ghana has a significant opportunity to replace imports with locally manufactured products and eventually become a net exporter of iron, steel and aluminium.
Dr. Donkor says lowering industrial power costs is therefore not merely an energy sector issue but an economic strategy capable of transforming Ghana from a raw material exporter into a value-adding industrial economy.
