The Public Utilities and Regulatory Commission (PURC) has announced a 1.52% reduction in electricity tariffs and an upward adjustment of water tariffs by 0.34% effective December 1, 2023.
This is contained in a press release dated November 23, 2023 signed by the Executive Secretary of PURC, Dr. Ishmael Ackah.
“Electricity Tariffs across board have been reduced by 1.52% for the fourth quarter of 2023…Water Tariffs have increased by 0.34% for the fourth quarter of 2023,” the statement read.
The PURC explained that “These adjustments are being carried out in line with the Commission’s Quarterly Tariff Review Mechanism, which tracks and incorporates movement 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.”
The new tariffs therefore cover the period December 01, 2023, to February 29, 2024
The utilities regulatory body further clarified that, “Adjustments to the existing electricity and water tariffs is undertaken on a quarterly basis to maintain the real value of the tariffs, thereby keeping the utility service providers financially viable to enable them deliver on their services to consumers. In addition, the Commission considered the competitiveness of industries and the general living conditions of the Ghanaian.”
According to the PURC, in arriving at the new tariffs, it considered factors such as, Cedi-Dollar exchange rate, inflation rate, price of natural gas and the electricity generation mix.
“A Weighted Average Ghana Cedi-US Dollar Exchange Rate of GHS11.9264 was used for the fourth quarter of 2023, which includes an under recovery of Ghs0.3792. The Commission used an average three-month projected inflation rate of 40.43% for the fourth quarter of 2023. Thus, the actual rate applied for the Quarter is 10.11. The applicable Weighted Average Cost of Gas (WACoG) is USD 7.6426/MMBtu. The projected hydro-thermal generation mix for the fourth quarter is 31.91% for Hydro and 68.09% for Thermal,” the PURC stated in the release.
