The Electricity Company of Ghana (ECG) is facing a deepening financial crisis, with inefficiencies and revenue shortfalls straining the national budget.

Finance Minister, Dr. Cassiel Ato Forson, speaking at the National Economic Dialogue, described ECG’s operations as unsustainable.

He cautioned that without immediate reforms, the energy sector risks collapsing under the weight of growing debt.

According to Dr. Forson, ECG successfully collects only 62% of the electricity it supplies, leaving nearly 40% unaccounted for—either lost due to technical faults or unpaid.

“The inefficiencies at ECG are costing the nation heavily. Government transfers to support the energy sector have reached unsustainable levels, yet the company continues to struggle with revenue collection and operational inefficiencies,” he stated.

This shortfall has forced the government to provide continuous financial support, with budgetary transfers reaching $2.1 billion over the past two years.

Dr. Forson emphasized that these inefficiencies are severely impacting the economy, as government support for the energy sector has reached unsustainable levels while ECG continues to struggle with operational and revenue challenges.

“The power sector should be a key driver of industrial growth, but instead, it has become a financial black hole, dragging the entire economy down,” Dr Forson stated.

Despite ongoing interventions, the company’s financial troubles are deepening, with projections indicating that by 2026, the cumulative deficit in the energy sector could surpass $9 billion, posing a serious risk to Ghana’s economic stability.

A major part of ECG’s struggle stems from widespread distribution losses, where a significant portion of power supplied is either lost due to system inefficiencies or stolen through illegal connections.

Additionally, ECG faces persistent challenges in collecting payments from both government institutions and private consumers, leading to large outstanding debts.

Poor financial management has further compounded the issue, as ECG often fails to meet its payment obligations to power producers, creating a chain reaction of debt across the energy sector.