Finance Ministry submits bill to Parliament to end sole-sourcing of power contracts

The government has laid before Parliament a Legislative Instrument (LI) that would require all future power generation contracts to go through competitive bidding, as part of efforts to tackle inefficiencies in Ghana’s energy sector.

The Minister of Finance, Dr Cassiel Ato Forson made the announcement on April 23, 2025, during a session on the Ghana Energy Compact under Mission 300, organised by the World Bank in Washington.

He said the proposed regulation is aimed at improving transparency in power procurement and securing better value for money.

“We have submitted the LI to Parliament to make competitive procurement of power plants the standard approach,” Dr Forson said. “If we are serious about fixing the deep-rooted problems in the energy sector, this is a necessary step.”

Dr Forson described the energy sector as the country’s most pressing economic challenge, revealing a current financial shortfall of about US$2 billion.

He attributed much of the gap to inefficiencies across the energy value chain, particularly at the Electricity Company of Ghana (ECG).

“ECG alone could reduce the shortfall by half if it addressed its internal challenges,” he stated. “We cannot continue to pass these losses on to consumers.”

According to Dr Forson, the LI forms part of a broader effort to introduce more discipline into the procurement process and prevent the cost of mismanagement from falling on the Ghanaian public through increased tariffs and levies.

He urged Parliament to treat the passage of the LI with urgency, noting that the success of the Ghana Energy Compact depends on swift and deliberate action.

“Time is of the essence,” he added.