HomeBusinessECG to use single revenue collection account – Finance Minister

ECG to use single revenue collection account – Finance Minister

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Finance Minister Mohammed Amin Adam has disclosed that a single account has been established for the Electricity Company of Ghana’s revenue collection activities.

In March, member of the Mines and Energy Committee of Parliament, Edward Abambire Bawa, called the ECG indisciplined and irresponsible for operating over 30 accounts for its revenue collection operations.

But, at a press conference on the sidelines of the IMF World Bank Spring Meetings in Washington DC, Dr Amin Adam said that the Ministry wants to ensure that ECG no longer uses multiple accounts for its operations.

The Finance Minister believes that this will ensure that tracing revenue collected by the ECG will not be a challenging task.

“We have also established a single collection account. Therefore, ECG will not collect revenue through the many accounts that they operate. Everything will come through a single collection account. So it is easier for all of us to track,” Dr Amin Adam said.

This comes after The Public Utilities Regulatory Commission, PURC, fined the ECG GHȼ36,000 for failing to submit all bank and investment accounts it currently operates to the Commission.

This followed the regulatory body’s statement in March that ECG acted irresponsibly when it used part of the money accrued under the Cash Waterfall Mechanism to purchase fuel to generate power.

The decision, which left the Volta River Authority (VRA) and the Ghana Grid Company (GRIDCo) cashless under the mechanism between November 2023 and January 2024, is said to be impacting negatively on the operational capacity of the two entities.

As such, the PURC had made three requests to the ECG with timelines of March 25, March 27, and April 2, 2024.

The information requested relates to the tariff revenue allocation under the Cash Waterfall Mechanism (CWM), the provision of regulatory audit data and the submission of information related to operational matters, as well as the provision of other regulatory audit data.

But in a letter submitted to the ECG on Monday, April 15, the PURC said it found that “details of ECG’s bank accounts submitted were incomplete, contrary to the Order.” It also defaulted in the submission of information related to operational matters.

“The Commission hereby imposes an initial regulatory charge of 3,000 penalty units on ECG in accordance with Regulation 45 of LI 2413, amounting to Thirty-six Thousand Ghana Cedis (GH₵36,000).”

The letter said “ECG shall pay the initial regulatory charge of GH₵36,000 to the Commission on or before 22 April, 2024.

On the time frame for compliance, the PURC added that after the payment, “for every working day that the requested details remain outstanding, ECG shall pay an additional regulatory charge of 3,000 penalty units, calculated daily until the date of compliance.”

Meanwhile, Dr Amin Adam also revealed that the government is auditing the Cash Waterfall Mechanism.

According to him, addressing the challenges facing the cash waterfall mechanism will bring accountability and transparency to revenue collections and ensure it is being used for its purpose.

“We have started auditing and we are also required to publish the findings from the audit. We have already done one audit and we have published the findings.”

“We are going to continue to do that so that we can bring transparency and accountability, so that all revenues meant for the cash waterfall goes to the cash waterfall for the purpose for which it was created,” Dr Amin added.

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