Electricity, water tariffs to Increase effective July 1, 2024
Effective July 1, 2024, electricity consumers will see a hike in their bills ranging from 3.45% to 5.84%, depending on their consumption category. Water tariffs will also rise by 5.16%. The Public Utilities Regulatory Commission (PURC) announced these changes, detailing a 3.45% increase for lifeline electricity consumers (0-30kWh) and a 5.84% increase for all other residential consumers (31 kWh and above) and non-residential categories. Industrial consumers will face a 4.92% rise in electricity tariffs.
The PURC explained that water tariffs will increase by 5.16% for all customer classes for the upcoming period. The adjustments aim to reflect changes in various economic factors and ensure the financial viability of utility providers.
The commission attributed the tariff increases to several factors, including the exchange rate between the US dollar and the Ghanaian cedi, domestic inflation, the cost of fuel, and the electricity generation mix. These adjustments are part of the PURC’s Quarterly Tariff Review Mechanism, designed to maintain the real value of tariffs and support the financial stability of utility service providers.
“These reviews have been undertaken in line with the Commission’s Quarterly Tariff Review Mechanism, which tracks and incorporates movements in key uncontrollable factors, namely the exchange rate between the US$ and the Ghana Cedi, domestic inflation rate, the electricity generation mix, and the cost of fuel, mainly natural gas.
“These reviews are undertaken to maintain the real value of the tariffs, thereby keeping the utility service providers financially viable to enable them to deliver on their services to consumers.”
The PURC emphasized that it also considered the general living conditions of Ghanaians and the competitiveness of local industries when making these decisions.
“The Commission, in undertaking this review also considered the competitiveness of industries and the general living conditions of the Ghanaian.” noted
The PURC also revealed that despite the continuous increase in tariffs, revenue collection by the utilities have not reflected the corresponding revenue collection.
It emphasised that total revenue requirement for the first quarter of 2024, amounted to GHS5.67 billion and an amount of GHS 6.81 billion in the second quarter.
This it said would result in an increase of GHS 1.14 billion over the first quarter revenue requirement.
“ The Commission, however , decided to recover GHS 5.90 billion of the GHS 6.81 billion required for the second quarter This decision was taken by the Commission taking into consideration the revenue collection performance of the sector since the continuous increase in tariffs have not yielded the corresponding increase in revenue collection by the utilities to cover sector expenditure”
