Electricity tariff to go down in 2018

Electricity consumers are likely to enjoy tariff reduction next year when the government presents its 2018 Budget to Parliament, the Minister of Energy, Mr Boakye  Kyeremanteng Agyarko, has said.

“It is the government’s faithful expectation that we should be able to reduce energy tariffs,” he said at a press conference in Accra last Wednesday.

Addressing some concerns of the public in respect of the energy sector, Mr Agyarko explained that the government had set two broad objectives in the power sector.

The first objective, he said, was to stabilise power to ensure its availability, while the second was to pursue tariff reduction.

“I believe that we have largely succeeded in stabilising power supply and our next mandate is to begin the reduction of prices.

“That takes a number of forms, including reduction of energy sector levies -which we did in the last budget. It doesn’t make much sense that for the same turbines and the same fuel, Cote d’Ivoire is producing power cheaper than us. Cote d’Ivoire, on average, produces at nine cents per kilowatt hour.

“We, on the average, produce at 14 cents per kilowatt hour. We have to find a way to reduce the cost of production and we are working on it,” he said.

Mr Agyarko expressed the belief that from 2018 the government should be able to start bringing power tariffs down.

Power situation

On the power situation, the minister assured the public that although the power situation had been stabilised, the country would soon move into an uninterruptible phase of power generation.

In that phase, he explained, power supply would be managed in such a way that regardless of the situation of the plants, there would be sufficient power to meet demand.

“At that stage, enough power buffers would be in place so that interruptions caused by the breakdown of machines or routine maintenance would not be felt or noticed by the public or consumers,” he said.

Mr Agyarko described the projected uninterruptible phase of power supply as the ultimate goal of the government, while phase three would involve the process of transforming the energy sector from where the current government took over.

“Not too long ago, we were in a serious power crisis, otherwise called dumsor, which technically was called the interruptible phase of power supply,” he said.

Mr Agyarko said the government had been able to move the country into the stable phase and it was obvious that the power situation had improved and would continue to improve.

“Our ultimate goal is to move the power situation from the stable phase to an uninterruptible phase,” he added

Other interventions

He said as part of interventions to enhance the power sector, the government had decided to provide the public with a monthly outlook of the power situation as part of inclusive governance.

He stated that the government had also put on Play Store a Google application known as the GRIDCO Systems Measuring Publisher (GRIDCO SMP) that would provide users in real time the data on local power generation and the conditions of the power generation machinery to ensure a 24-hour monitoring by all stakeholders to ensure efficiency.  

He expressed the ministry’s willingness to build the capacity of the media on how to use the system so that they could monitor the power generation situation at any given time and be able to feed the public with current information.

Petroleum price hikes

On the recent calls on the government to reduce petroleum prices, the Deputy Energy Minister, Dr Amin Adam, explained that with the deregulation policy, there was little the government could do in determining the prices of petroleum products.

He was, however, quick to add that the government was doing its part to ensure that the prices of petroleum products would became reasonable.

He said it was for that reason that the government reduced special petroleum taxes from 17.5 per cent to 15 per cent and went ahead to scrap the excise duty on petroleum products in the 2017 budget.

He attributed the price hikes to market and external forces, including petroleum pricing on the global market, levies and taxes as well exchange rate depreciation which were beyond the control of the government

The price of fuel is said to be at an all-year high in September, with diesel selling at GH¢4.29 per litre and petrol selling at GH¢4.23.

In July, diesel was sold at about GH¢3.77 per litre, while petrol was sold at GH¢3.76.

NPA

The Chief Executive Officer of the National Petroleum Authority (NPA),  Mr Hassan Tampuli, explained that it was in the interest of consumers that the about 10 taxes and margins on fuel prices could not be taken off.

He said those levies were also to ensure that taxes were paid on every petroleum product that was consumed within the country.

He said when the government assumed office, it scrapped some of the taxes, which saw a three per cent cut in the prices of fuel, but indicated that a further reduction would be suicidal.

Writers email doreen.andoh@graphic.com.gh