The Food and Beverages Association of Ghana (FABAG) says the proposed upward review of electricity tariffs by the Public Utilities Regulatory Commission (PURC) will cripple businesses, trigger job losses, and derail government’s 24-hour economy policy.

In a strongly worded statement, the Association described the planned increases as “a recipe for disaster.” It said the business sector, especially food and beverages, is already in distress.

“Though food is a necessity, sales in the Food and Beverages sector has dropped by 70% in recent times. Businesses are really struggling, and their woes appear to be exacerbated by the recent depreciation of the Ghanaian cedi.”

FABAG argued that higher tariffs will directly assault Ghanaian households.

“Tariff increase will hit Ghanaian families where it hurts most — their daily survival. For low and middle-income households, electricity and water bills already consume a large share of disposable income. Any further increase will force families to choose between keeping the lights on and putting food on the table.”

The Association warned of worsening energy poverty. “Energy poverty will worsen, pushing vulnerable groups, especially women-led households and rural poor, deeper into hardship.”

It questioned whether inefficiency in the power sector should continue to be transferred to citizens.

“Should inefficiencies in the Utility sector be continuously paid for by the struggling Ghanaian mother selling bread at dawn, or the nurse keeping a clinic running at night, or even the owner of a small-scale business struggling to make ends meet?”

FABAG said tariff hikes will ignite inflationary shocks across the economy. “Upward adjustment of Utilities, especially ECG tariffs, combined with the current depreciation of the cedi, will serve as a major inflationary wildfire.

"It must be noted that Utilities are the foundation of the cost structure of food, transport, and housing, which are Ghana’s inflation drivers. An upward adjustment of tariffs will fuel a fresh round of price hikes for bread, kenkey, water, and beverages.”

The group stressed that the outcome would be widespread hardship. “Cold store operators and small restaurants will pass costs onto consumers. Transporters will raise fares as fuel depots and garages factor in higher utility bills.

"The outcome will be serious inflationary shocks across the economy that will punish ordinary Ghanaians and force tighter monetary policy, further slowing growth.”

The Association further argued that businesses cannot withstand another blow. “Utility tariff hikes, especially ECG, will wipe out the current thin margins of SMEs and trigger layoffs and factory downsizing. Indeed, any tariff adjustment upwards will seriously put jobs and enterprises on the line.”

FABAG accused ECG of inefficiency. “The attitude of most of the ECG staff is nothing to write home about.

Most workers have literally privatised their desks and remain unconcerned in the face of non-functional prepaid meters. We can’t continue to encourage alarming inefficiency in energy by adjusting tariffs upwards.”

The Association also warned that Ghana’s competitiveness under AfCFTA is at stake. “Upward adjustment of Utility tariffs will put Ghana’s competitiveness at further risk.

"Higher production costs make Ghanaian products uncompetitive compared to imports from countries with cheaper energy. This will undermine AfCFTA opportunities, discourage investment, and slow down Ghana’s industrialisation drive, especially the 24-hour economy.”

FABAG demanded reforms and accountability. “Every tariff increase not matched by efficiency gains is a direct attack on jobs, livelihoods, and Ghana’s industrial base.

"We demand Performance-Linked Tariffs. The Utilities must first reduce system losses, improve collections, change the attitude of staff and cut waste before passing costs to consumers.”

The Association insisted that poor and vulnerable households must be protected. “There must be protection for the Poor, SMEs and indeed the private sector, which is the engine of growth for the economy.

"The PURC must expand lifeline bands for genuine low-income users as well as design support measures for players in food and beverage sector.”

FABAG concluded that Ghanaians should not be punished for inefficiency.

“Ghanaians cannot continue to pay for inefficiency. Every cedi lost to poor collections, outdated infrastructure, and system leakages should not be transferred to the pockets of hardworking citizens and struggling businesses. A tariff increase without accountability is not reform — it is punishment.

"We urge PURC to put the people first — phase adjustments, demand efficiency, protect the poor, and support Ghanaian businesses. That is the only way to balance cost recovery with economic survival.”