Cabinet approves private sector procurement of power plants

Finance Minister Dr. Cassiel Ato Baah Forson has announced private sector participation in Ghana’s energy sector through power plant procurement to stabilise electricity.

“Cabinet has already approved private sector participation, and we have submitted the Legislative Instrument to Parliament to enable competitive procurement for power plants,” he said.

The minister disclosed this after discussions on the Ghana Energy Compact under Mission 300 at the 2025 World Bank Group (WBG)/International Monetary Fund (IMF) Spring Meetings in Washington, DC, USA.

“The Energy Compact has come at the right time. It can potentially make a lasting impact, and we hope the process will not be delayed.

“These are critical steps toward bringing transparency and sustainability to the sector,” he said.

Dr. Forson described the energy sector’s US$2 billion financial shortfall as Ghana’s biggest economic risk and pledged swift government action.

“This challenge goes beyond tariffs… the Electricity Company of Ghana (ECG) alone could cut the shortfall by half if it addresses these inefficiencies,” he noted.

“Time is of the essence. We must act swiftly to turn this around for the good of our economy and the well-being of our people,” he added.

Dr. Forson stressed the urgent need for energy sector reforms, particularly in distribution, to prevent high consumer tariffs.

Following Ghana’s Fourth Review under the Extended Credit Facility (EFC) programme, the IMF team flagged delays in energy sector reforms and policy actions.

The team called for quarterly electricity tariff adjustments and structural reforms to reduce the sector’s shortfall and stop new arrears accumulation.

The Public Utilities Regulatory Commission (PURC) has since announced a 14.75 per cent electricity tariff increase, effective May 3, 2025, aimed at ensuring “revenue stability for utility service providers” while minimising consumer impact.

GNA