The Ministry of Energy and Green Transition has rolled out a guiding framework for private sector participation (PSP) in Ghana’s Electricity distribution sector.
The initiative is a significant milestone to strengthen electricity service delivery, improve operational efficiency and secure a resilient and sustainable energy future for the country.
The guiding framework provides a clear and coherent structure for advancing that agenda.
It sets out the processes, roles and responsibilities that will guide the work of the Technical Advisor and the PSP Implementation Unit, in close collaboration with the Electricity Company of Ghana (ECG), the Northern Electricity Distribution Company (NEDCo) and the relevant regulatory institutions.
Distribution
In an address read on his behalf by the Chief Director of the Ministry of Energy and Green Transition, Solomon Adjetey-Sowah, the sector minister, John Abu Jinapor, said the main goal of the framework aimed at improving electricity distribution by reducing losses, improving efficiency and service quality, attracting investment and ensuring better customer satisfaction.
With the PSP Model, he said the government would use a multiple-lease model, where private operators would lease and run distribution zones but did not own the assets.
On the scope of work, the minister said PSP operators would manage the entire power delivery chain within their zones from bulk supply points to customers, and would be accountable for both technical performance (reliability, quality, losses) and commercial performance (billing, collections, customer service).
Regarding asset ownership, Mr Jinapor said core electricity assets would remain public (owned by ECG/NEDCo/GoG) and that PSP operators would lease, operate, maintain and upgrade them for the contract period.
Concession
He said with zoning and tariffs, concession zones would combine ECG and NEDCo areas for balance. “Consumer tariffs remain uniform nationwide, while wholesale tariffs will vary by zone to ensure fair profitability,” he said.
He said for the remuneration system, operators would be paid using a performance-based model with fixed service payments plus rewards/penalties tied to efficiency, service quality and loss reduction.
For regulatory and social safeguards, Mr Jinapor said ECG/NEDCo’s existing licences would be reissued by PSP Operators, and that the “The model must protect social policies, maintain uniform tariffs, support lifeline customers, define public lighting responsibilities and address labour and contractor transition issues.”
“It emphasises transparency, accountability and strong performance monitoring to ensure that the partnership delivers measurable improvements in service quality and financial viability,” he said.
Future
The Government, the Energy Minister said, envisioned a future where losses were significantly reduced, revenue collection strengthened, modern customer service, responsive, technology-driven and investments in network upgrades timely and sustainable.
“The PSP Framework is, therefore, a strategic tool designed not to privatise our utilities but to enhance performance, build resilience and unlock the full potential of the distribution sector,” he said.
Mr Jinapor commended the steering committee, the subgroups, and the technical teams from ECG, NEDCo, the Ministry of Energy and Green Transition, and the Ministry of Finance for their diligence and dedication, adding that the country’s development partners, including the World Bank, IFC, USAID, AfDB, and others, had provided valuable technical and analytical support throughout this process.
Mr Adjetey-Sowah later launched the framework on behalf of the minister.
Responsibility
In a presentation on the framework, the Chairman of the committee, Jabesh Amissah-Arthur, said the scope of the PSP was that the private sector operator would take full responsibility for delivering energy from the bulk supply points to the consumer.
He said the number of PSPs to be formed was yet to be decided, and that it would be done in consultation with the technical advisor that would be appointed.
“We are going to have engagement ... all over the country for people to bring their comments so that if there are amendments required, these amendments will be taken on board and adjusted so that we have a system for private sector participation that all of us agree is the best way forward,” he emphasised.
