Acknowledging the central role of the Electricity Company of Ghana (ECG) in the delivery of reliable and affordable power for national development, and concerned by the persistent inefficiencies, procurement irregularities, revenue shortfalls, and mounting debt that threaten the sustainability of the energy sector, JoyNews convened a National Dialogue on ECG’s operational and financial future.

Bringing together key stakeholders, policymakers, regulators, civil society actors, energy experts, and consumer advocates, the dialogue sought to examine the root causes of ECG’s structural challenges and to explore practical, forward-looking reforms.

These discussions come at a time when ECG’s debt exceeds GHS 68 billion and independent power producers are owed 1.73 billion dollars, posing serious risks to national energy security and economic stability.

The dialogue also comes against the backdrop of ongoing conversations around the partial or full privatization of ECG’s operations, a commitment previously made under the current IMF programme by the previous NPP government. With the current government expressing renewed intent to privatize aspects of ECG to improve efficiency and financial performance, the forum served as a crucial platform to deliberate on the merits, risks, and models of privatization that could ensure ECG’s long-term viability while protecting public interest.

Key recommendations and next steps

1. Improve Revenue Collection Discipline: ECG must urgently address its chronic revenue shortfalls. This includes enforcing strict internal controls, minimizing system losses, and ensuring staff and management adhere to laid-down operational procedures.
2. Minimize Political Interference: The top management of ECG must be empowered to resist political pressures. Government must ensure that appointments, particularly that of the Managing Director, are based on competence and the capacity to act independently in the best interest of the company.
3. Tie Executive Compensation to Performance: The remuneration of ECG’s top management, including the MD, should be performance-based. There must be clear accountability measures, including dismissal for non-performance, to incentivize results-oriented leadership.
4. Promote Citizen Engagement and Ownership: The transformation of ECG must include deliberate public education and engagement to ensure Ghanaians understand the challenges and support solutions. National buy-in is essential for any reforms to succeed.
5. Revise the Cash Waterfall Mechanism: ECG should retain a larger portion of its internally generated funds under the cash waterfall mechanism. This would enable the company to reinvest in infrastructure, pursue growth opportunities, and build financial resilience.
6. Enable Strategic Investment of Revenue: ECG must be allowed to strategically invest portions of its revenue in secure financial instruments such as fixed deposits and treasury bills to generate additional income for operational improvements.
7. Address Forex Exposure Risks: The current model where ECG purchases power in dollars and sells in cedis is unsustainable. Government and sector stakeholders must either transition power purchase agreements to cedi-denominated contracts or stabilize the cedi to prevent recurring foreign exchange losses.
8. Fix Systemic Inefficiencies Across the Value Chain: To avoid the necessity of privatization, ECG must identify and address inefficiencies across the entire electricity supply chain—from generation to distribution—starting from boardroom-level reforms down to operational execution.
9. Live Within Operational Means: ECG must prioritize efficiency by operating within its revenue envelope, particularly its Distribution Service Charge. This requires tighter fiscal discipline and strategic expenditure planning.