The Public Utilities Regulatory Commission’s validation reports on the Cash Waterfall Mechanism (CWM) have revealed that the Finance Ministry owes some power generators about GH₵1.28 billion, as Ghana continues to grapple with erratic power supply.

JoyNews’s checks and analysis of the PURC’s validation reports from August 2023 to February 2024 show that the Finance Ministry has not complied with its ‘top-up’ role under the revised CWM, bringing the total arrears to approximately GH₵1.28 billion.

According to the Commission’s February validation report, the Finance Ministry “has not made up for the shortfalls since August 2023”.

The most recent failure occurred in February 2024, where the Ministry of Finance was “expected to release an amount of GH₵197,112,973.25 in accordance with the CWM guidelines and the approved CWM model”, PURC stated.

Since October 2023, the top-up amount has remained above GH₵200 million before dropping slightly to GH₵197.11 million in February 2024.

In fact, in its February 2024 validation report, eight State Owned Enterprises including GRIDCo, Bui, and VRA were scheduled to receive more than GH₵197 million from the Finance Ministry towards power generation and transmission under the CWM.

These payments by the ministry are aimed at addressing the shortfalls in the Level B category, ensuring that no arrears accumulate in the power sector. Additionally, they facilitate the purchase of gas for electricity generation, thereby supporting the uninterrupted supply of electricity.

The PURC says it has issued relevant payment instructions since August 2023 on behalf of the Cash Waterfall Mechanism (CWM) to the Ministry of Finance to pay, but the ministry is yet to make comply.

According to the revised Cash Waterfall Mechanism, “Level A payments shall be made to IPPs directly by ECG and Level B payments to SOEs and fuel suppliers”.

February 2024: MoF top-up

January 2024: MoF top-up

December 2023: MoF top-up

November 2023: MoF top-up

October 2023: MoF top-up

September 2023: MoF top-up

August 2023: MoF top-up

About the writer:

Isaac Kofi Agyei is a Data & Research Analyst/Journalist at JoyNews based in Accra, where he covers mostly finance, economics, banking, and politics across Ghana and West Africa, from detailed analytical reports on all key issues to debt crises to IMF programmes. He also serves as the data and research correspondent for SBM Intelligence, an Africa-focused market/security leader in strategic research, providing actionable analyses of West Africa’s socio-political and economic landscape. With his solid academic background in economics and statistics and additional training from credible institutions such as the UNDP, Afrobarometr, Ghana Statistical Service, and a host of others, Isaac has honed his skills in effective data storytelling, reporting, and analysis.

Isaac Kofi Agyei