Business News of Thursday, 11 July 2019
Renowned economist and investment consultant Mr. Kwame Pianim has called for fair pricing of electricity to ensure producers are able to cover their costs and make a fair return on their investments, while on the consumption side waste is contained.
He was speaking as a panelist at the second edition of the Ghana Energy Summit 2019, which took place in Accra under the theme ‘Harnessing opportunities in Ghana’s Energy sector, making local participation a practical reality’.
Speaking on the sub-topic ‘Electricity Tariff- A stimulus or a Catalyst for Economic growth?’, he said: “Electric tariff by itself is not important as a stimulus or catalyst for Economic growth. Fixing an Electricity tariff is a balanced idea, because in the course of doing that you have to make sure both the supply and demand side is balanced”.
He said: “Electricity like any product if not appropriately priced encourages waste and leads to supply inefficiencies. Producers and generators must be given tariffs that reflect a fair risk-adjusted rate on their investments, so they can generate sustainable business to pay their suppliers and to maintain equipment.
“Consumers’ expectations are to have an uninterrupted and reliable supply of electricity, and tariffs that are not necessarily affordable but reflect the scarcity value of the product.”
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Mr. Pianim also added that: “In terms of Electricity supply on Economic growth, without an adequate, efficient and reliable supply of electricity, no nation can build a sustainable and transformational economy to produce goods and services and be globally competitive’’.
He indicated that the right management is very critical. “Management by men and women of professional competence, moral integrity and courage is important in securing an efficient supply of electricity. It is a shame that in the 21st century, with all the Ghanaian scientific engineers and technology that we have, we cannot manage our own ECG.”
The two-day annual Energy Summit brought together policymakers and key stakeholders in the energy sector to deliberate on matters concerning the country’s energy sector.
Panelists deliberated on the feasibility of the hub concept, oil exploration, gas production and how it should be packaged and managed sustainably, and the necessary infrastructural backbone to drive its success.