Deputy Director of the IMF, Ms. Catherine Pattillo and Mr. Luc Eyraud, Division Chief of the African Department, have emphasised the need for Ghana to implement stringent reforms during a press briefing in Accra.

These reforms are essential to empower utility service providers, allowing them to recover costs effectively. The aim is to ensure reliable and sustainable power for both household and industrial use.

The IMF representatives also stressed the importance of creating an enabling environment for private sector involvement, particularly in increasing the use of renewable energy. They urged other African nations grappling with energy challenges to follow suit.

Ms. Pattillo highlighted that Ghana, like many other African countries, faces obstacles due to its current tariff structure. This structure fails to adequately support high-cost recovery by utility service providers, thereby limiting their operational capacities.

“Sometimes, the setup of the energy sector does not allow utilities to recover their costs from the charges they make to operate profitably and efficiently and supply energy as needed,” she said.

Regarding the Fund, she said, “we are always discussing with countries how to ensure that their energy sector, which often involves a number of state enterprises, is well managed to recover their costs and provide services.”

Mr. Eyraud emphasised the importance of recalibrating tariff systems, noting that it would help boost cost recovery.

He also called on the government to institute mechanisms that would increase the country’s share of renewable energy through enhanced private sector participation.

He mentioned South Africa as one country on the continent that had been doing well in the area of renewable energy, “by bringing in more private producers and reducing the barriers to entering the market.”

In recent weeks, Ghana has been grappling with intermittent power outages, primarily stemming from financial constraints in acquiring fuel necessary for certain power plants to function at optimal levels.

During an interview with the Ghana News Agency last week, Nana Amoasi VII, representing the Institute for Energy Security (IES), underscored the critical need to provide resources to the Electricity Company of Ghana (ECG) to address the ongoing power outages.

“We expect the Ministry of Energy to coordinate and work with the Ministry of Finance to find alternative funding sources to deal with the challenge, specifically to procure fuel to get some of the power plants online,” he said.

During his speech at the 2024 May Day celebration in Accra, President Nana Addo Dankwa Akufo-Addo expressed confidence in the continuity of power supply, suggesting that certain issues within the sector had been successfully addressed.

“Over time, the issues surrounding transformers and gas supply have been successfully resolved, resulting in a significant improvement in power supply reliability,” he said.