The Electricity Company of Ghana (ECG) has proposed a 225% increase in its Distribution Service Charge (DSC1), a move that could sharply raise electricity costs for millions of households and businesses.
In its submission to the Public Utilities Regulatory Commission (PURC), ECG argued that the steep adjustment — from GHp19.0384/kWh to GHp61.8028/kWh for the 2025–2029 tariff period — is necessary to avert financial collapse and sustain reliable power supply.
ECG, which serves over 73% of Ghanaians across 4.87 million customer accounts, says the current tariff is unsustainable. It noted that DSC1 makes up only 11% of the total electricity value chain, far below the global benchmark of 30–33%.
The company cited the cedi’s 74% depreciation between 2022 and 2024, which it said slashed the real value of its revenue by 45%.
Investment and Service Improvement
ECG says the proposed increase will fund critical infrastructure projects, including new substations, automation, and the deployment of more than 3 million smart meters.
The utility has already invested US$408 million since 2022, and projects that with the new tariff:
Power outages will reduce significantly: SAIDI (average outage duration) will fall from 32.5 hours in 2024 to 19.2 hours by 2029.
Frequency of interruptions will improve: SAIFI will drop from 16 to 9.
- System losses will reduce: from 27% to 22%.
- Revenue collection efficiency will rise: from 87% to over 90%.
ECG also pledged to replace faulty meters free of charge, improve voltage supply, and speed up complaint resolution. Customers will be encouraged to use the ECG Power App for payments and service requests.
Dependence on Bailouts
The utility insists that a cost-reflective tariff is the only way to end its reliance on government bailouts, freeing up funds for other national priorities.
The PURC will now review ECG’s proposal, hold public consultations, and decide whether to approve the new rates. Any changes will take effect only after the regulator’s approval and public announcement.
