Dr. Shafic Suleman
The Public Utilities Regulatory Commission (PURC), has announced an upward adjustment in electricity by 14.75% and water by 4.02% for the first and second quarters of 2025 starting May 3.
A statement issued and signed on Friday April 11, 2025, by the Executive Secretary of the Commission, Dr. Shafic Suleman, said the regulatory process for the quarterly adjustment is in line with the Commission’s tariff review mechanism outlined in its rate setting guidelines for quarterly adjustment of natural gas, electricity and water tariffs.
It said, “The Commission, in their decision today at 6pm reviewed upward the average end-user tariff for electricity by 14.75% and 4.02% upward for water supply across board for all category of consumers”.
“For the second quarter of 2025, a Weighted Average Exchange Rate of GH¢15.6974 to the USD was used for computation of the tariffs. This implied an under recovery of GH¢0.1700 from the last quarter review in 2024. The Commission used an average three-month projected inflation rate of 22.49% for the second quarter of 2025,” it said.
According to the Commission, a key variable that contributed significantly to the 2025 quarterly tariff adjustment was an inevitable attempt to pay half, thus 50% of an outstanding revenue of GH¢976Million carried over from the previous three quarters of 2024 with the remaining 50% to be spread over the subsequent quarters of the year.
“The combined effect of the cedi/dollar exchange rate, inflation and the payment of 50% of outstanding revenues from the previous quarters in 2024 is that the utility companies are bleeding from serious under recovery. For the time value of money, utility companies just like other businesses, will need periodic reviews of their prices (tariffs) in order to remain operational,” it added.
It further stated that a total payment of the outstanding revenues from the previous quarters would have resulted in much higher increase in both electricity and water tariffs, but however mentioned that Commission, being mindful of the current economic difficulties for Ghanaians decided to recoup only half of the outstanding debts.
That it noted has always been the ‘careful balancing act’ the Commission does in order to minimise the impact of tariff increases on livelihoods while ensuring that the utilities are well-capitalised to keep the lights on.
“The Commission will continue to implement the quarterly tariff review in accordance with its rate setting guidelines for quarterly review of natural gas, electricity and water tariffs and in doing so, the Commission will continue to balance the interest of both consumers and utility service providers” it stated.
By Ebenezer K. Amponsah