The government has approved private sector involvement in efforts to revive Ghana’s struggling energy sector, which is said to be losing around US$2 billion each year.
Finance Minister Cassiel Ato Forson made this known during a detailed discussion on the Ghana Energy Compact held under the World Bank’s Mission 300 programme.
Dr Forson described the energy sector as the greatest economic risk currently confronting the country. He said the annual shortfall is larger than Ghana’s entire domestic capital expenditure and warned that the situation must not be ignored.
“The problem is not just tariffs,” he said. “The inefficiencies, especially in the distribution sector, are being passed on to the ordinary Ghanaian, making electricity costs unnecessarily high.”
He pointed to the Electricity Company of Ghana (ECG) as a major part of the problem, arguing that the company could cut the financial shortfall by half if it dealt with its operational inefficiencies.
As part of the government’s plan to address the challenge, Forson said the Cabinet has approved a new strategy that includes allowing private entities to participate in the sector. He added that a Legislative Instrument has already been laid before Parliament to allow for competitive bidding in the procurement of power generation services.
Speaking about the Ghana Energy Compact, Forson said the initiative has come at an opportune time. “The compact has come at the right time. It will in the long run assist Ghana, and we are praying the process is not delayed,” he said.
He called for swift and coordinated action, stating, “Time is of the essence. We must act quickly if we are to prevent further damage to our economy and improve the lives of Ghanaians.”
Forson made these remarks on Tuesday, 22 April 2025, during engagements between government officials and development partners on how to address longstanding challenges in the energy sector.
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