Economist Professor Godfred Alufar Bokpin has raised alarm over the scale of inefficiencies in Ghana’s power distribution system, describing the Electricity Company of Ghana’s (ECG) losses as far above global averages and economically unsustainable.
Speaking on Joy News’ Newsfile on Saturday, May 17, Professor Bokpin said ECG’s technical and commercial losses—currently hovering around 40%—are dangerously high.
“Even if you’re doing 15%, it is very high,” he stated. “But 40%? That is simply not sustainable. With that level of losses, you cannot talk about realistic pricing. You cannot pass on all those losses to the ultimate consumer.”
He expressed deep concern over the country’s ongoing energy crisis.
“Apart from irresponsible mining, including illegal mining, what causes me sleepless nights is the energy sector,” he said.
According to him, both the NDC and NPP have failed to effectively tackle the issue, and it’s time to remove politics from energy sector management.
“We’ve seen the track records of both the NDC and the NPP, and at this point, we can no longer do politics with it. The politicisation doesn’t help. There are fundamental issues that need to be resolved.”
He noted that, in addition to the 40% distribution losses, collection inefficiencies are also troubling.
“Collection losses are close to 15%. That’s again above the world average. It’s not sustainable,” he said.
Professor Bokpin also highlighted problems with electricity pricing.
“There are tariff gaps. The pricing formula does not fully reflect the costs. You cannot ignore that when you talk about viability,” he explained.
He further condemned the failure of government institutions to pay their electricity bills, worsening ECG’s financial woes.
“We’ve heard the minister say it’s about time ministries, departments, and agencies take responsibility for their energy consumption,” he recalled. “There are sensitive government installations, including some educational institutions and police stations, that do not pay for electricity.”
He shared a disturbing anecdote to illustrate how deep the problem runs.
“Someone once asked me if I’d ever thought about where the ice blocks come from that pure water sellers use. They joked that it’s probably from police stations. I’m not saying this is true, but if this is even a possibility, then we have a big problem.”
According to him, the entire system is fundamentally broken and cannot support Ghana’s future energy needs.
“If you put all these things together, there is no way we can see a future in this direction,” he stressed.
“And yet you have a government talking about a 24-hour economy. You are not even getting power for your eight-hour economy cycle, and you’re talking about 24 hours?”
Professor Bokpin argued that ECG’s current management model is unsustainable and must be reformed.
“We should all support government in some kind of private sector participation in the downstream distribution,” he urged.
“This is different from saying we are selling ECG. Government can still be the sole shareholder, but we must invite the private sector into power distribution and revenue collection.”
He said private sector involvement would bring in the capital and efficiency the state alone cannot provide.
“On this current model, I don’t think it is sustainable,” he added.
“There are structural reforms under the IMF-supported programme that require clear indicators to be met. I know cabinet has to take a decision on ECG in terms of private sector participation, and I believe government must communicate this clearly to Ghanaians.”
He concluded with a stern warning: “We are at a point where we must be honest with ourselves. The current path is not working. We need bold reforms.”
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