The Public Utilities Regulatory Commission (PURC) has approved a 3.02% increment in electricity tariffs and a 1.86% rise in water tariffs for the third quarter of 2024.
The new tariffs, which take effect on October 1, 2024, follow the Commission’s quarterly review of existing tariffs to reflect changes in macroeconomic and market-driven variables.
This decision, driven primarily by the depreciation of the Ghana Cedi against the US Dollar and rising costs in electricity generation, aims to ensure the financial sustainability of utility companies while reducing the fiscal burden on the government.
The tariff adjustments also seek to maintain service delivery by the regulated utilities, including the Electricity Company of Ghana (ECG), Ghana Water Limited (GWL), and the Northern Electricity Distribution Company (NEDCo).
The Commission’s review was influenced by a range of factors, including the inflation rate, exchange rate, and the cost of natural gas.
Notably, the projected exchange rate for the third quarter of 2024 is pegged at GHS 15.3855 to the US Dollar, a 4.96% depreciation compared to the second quarter.
The inflation rate has also slightly decreased, with a projected quarterly average of 5.57%.
The PURC emphasized that the new tariffs are necessary to sustain the operations of the utility providers, particularly with the expectation that they will meet the regulatory benchmark of 98% for revenue collection.
The projected revenue for the third quarter amounts to GHS 2,024.5 million for ECG, GHS 243.20 million for NEDCo, and GHS 227.40 million for GWL.
This tariff increment is expected to translate into improved revenue collection and enable utility companies to meet operational costs, maintain infrastructure, and continue providing essential services to consumers.
The Commission reiterated the importance of adhering to the 98% revenue collection benchmark to ensure the sustainability of both the energy and water sectors.
Consumers are advised to prepare for these adjustments, as the PURC continues to monitor key economic indicators to ensure that future tariff reviews reflect current conditions without compromising service delivery or utility company viability.
