The Public Utilities Regulatory Commission (PURC) has announced an 18.36% increase in tariffs for electricity and natural gas across all consumer groups for the second quarter of 2023.
According to a statement released by the PURC, the decision was made to strike a balance between preventing extended power outages and their adverse effects on jobs and livelihoods, while minimizing the impact of rate hikes on consumers.
The Quarterly Tariff Review Mechanism was employed to track and incorporate changes in key factors used to determine natural gas and electricity tariffs.
The Ghana Cedi/US Dollar exchange rate, inflation, electricity generation mix, and the weighted average cost of natural gas (WACOG) were identified as the factors influencing the tariff increase.
The PURC clarified that the review was necessary to maintain the real value of the cost of supplying utility services and prevent the under or over-recovery of costs.
Under-recovery poses risks to the ability of utility companies to provide consistent service and could potentially lead to electricity outages, while over-recovery imposes unnecessary burdens on electricity consumers.
The commission acknowledged the potential adverse impact of rate increases on consumers and emphasized the need to ensure a reliable power supply to avoid extended power outages, commonly known as “dumsor.”
The decision to increase tariffs was made after extensive deliberations and analysis to strike a balance between the interests of utility service providers and the welfare of consumers.
The PURC continues to implement quarterly tariff reviews based on its Rate Setting Guidelines, aiming to equitably balance the interests of both utility service providers and consumers.
