Executive Director of the Africa Centre for Energy Policy (ACEP), Ben Boakye says the one-cedi levy on electricity bills is critical to covering inefficiencies in the power sector, cautioning that removing it without alternative funding could disrupt government projects and debt obligations.

Speaking on Joy FM's Super Morning Show on April 8, Ben Boakye defended the continuation of the one-cedi levy on electricity consumers, describing it as a necessary measure to manage debt and maintain the power sector.

“Those are choices that the economic managers want. I can indicate that one cedi is aligned to debt savings,” Mr Boakye said.

He explained that the levy helps pay for gas used in electricity generation, which is included in the cost of power consumers use.

“It’s aligned to pay for gas ordinarily, to pay for the power sector, because the gas is priced into the electricity that we consume.

"But because ECG cannot collect enough money, or cannot sell all the power that is given to them, or some power is stolen and not accounted for, the gas cannot be paid through the service,” he explained.

Mr Boakye noted that the Ministry of Finance must step in to cover these shortfalls.

“And therefore, the Ministry of Finance has to pick that. Those levies are being used to pay for those inefficiencies in the past,” he said.

He warned that removing the levy without creating fiscal space elsewhere would force difficult trade-offs, including halting road projects, school constructions, or affecting salaries.

“So, if you take that one cedi out now, there has to be some fiscal space created somewhere else whether you suspend road construction, suspend building of schools, or adjust salaries to absorb other commitments,” Boakye said.

He noted the tough choices between servicing debt now or shifting costs to consumers in other ways.

“So those are choices we have to make, whether we pay our debt now or create debt that the same consumer will have to cover in other ways,” he added.