Ghana’s government has been urged to review the prevailing electricity billing system, in order to cushion industries against rising cost of production.
According to the Head of Business Development at the Kwame Nkrumah University of Science and Technology (KNUST), Samuel Yaw Akomea, it has become imperative for the government to take heed of developed economies where producers pay less for power, as a way of accelerating industrialisation.
“We cannot transform our industrial sector with erratic and expensive energy regime,” he said, adding that this will create the necessary space needed by industries to produce more and employ more people.
“An enabling business environment will automatically attract both domestic and foreign investors to drive industrialization,” he added.
Over the past decade, Ghanaian businesses have had to grapple with the unreliable and increasing cost of electricity, which has been cited for the relative below par economic performance of the country over the period.
Earlier this year, a Business Barometer (BB) report released by the Association of Ghana Industries (AGI), said the rising cost of electricity was the number one challenge for businesses across almost all the ten regions of the country.
The report further noted that the high cost of electricity was a major challenge to the growth of businesses in the fourth quarter of 2016 followed by a high number of taxes and delayed in payments of projects.
Also, the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana, in 2014 estimated Ghana that loses between $US320 million and $US924 million per annum in productivity and economic growth due to the country’s power crises.
Currently, the power sector in Ghana faces a host of challenges, including inadequate power supply infrastructure that requires huge investment, over-reliance on hydro and gas, inadequate access to electricity, high cost of fuel for electricity generation, transmission and distribution losses, an inadequate regulatory capacity, enforcement, operational and management difficulties, and vulnerability to climate change.