Business News of Sunday, 16 July 2017
The Electricity Company of Ghana would soon be compelled to install prepaid meters across the country to reduce the system and revenue losses bedevilling its operations and ultimately saddling it with debt.
The power distributor is estimated to lose between 30 and 40 percent of expected revenue from the power it distributes, according to the World Bank, leading to huge debts that have hampered its operations.
Speaking at the launch of the Direct Savings and Loans Company in Accra, the Vice President, Dr Mahamudu Bawumia, indicated that financial institutions are carrying large debts on their books from the energy sector, arising largely from the failure of the ECG to recover costs for power consumed, and the time may be right to take some radical but essential measures about ECG operations.
Dr. Bawumia noted that even though the government plans “to issue an energy sector bond, even when the bond is issued, if we don’t address the fundamentals of collection of electricity bills by ECG, you will end up going back to the same point.
“And so let’s seriously consider this issue of collection of electricity bills, and we want to move to a wholesale adoption of prepaid meters across the country for at least 95% of ECG customers to ensure that even if the ECG doesn’t want to collect we will make sure it collects the bills to keep our financials stable.”
Alluding to Government’s determination to ensure fiscal discipline, Vice President Bawumia said the President was determined to entrench fiscal responsibility across all sectors.
“We have to continue to take measures to deepen the fiscal consolidation and also to institutionalise the fiscal consolidation. At the end of the day, the fiscal discipline matters.
And this is why the President has said that we should look at how to bring more fiscal responsibility in the management of our economy going forward.
We don’t want to do that dance, one step forward, three steps backwards, as we have been doing. We want to entrench fiscal responsibility.” he concluded.