Electricity and Water Tariffs to Rise on May 3; PURC Cites Economic Pressures
Consumers in Ghana will see an increase in utility tariffs starting May 3, 2025. This follows a new tariff approval by the Public Utilities Regulatory Commission (PURC), which will raise electricity rates by 14.75% and water tariffs by 4.02% across all customer categories.
The PURC announced the tariff adjustment in a statement issued Friday evening, April 11, 2025, signed by its new Executive Secretary, Dr. Shafic Suleman. The Commission explained that this decision was driven by changes in several key economic variables, including the cedi-to-dollar exchange rate, domestic inflation, the cost of natural gas, and the electricity generation mix.
Dr. Suleman noted that although the actual outstanding revenue from previous quarters warranted a much higher increase, the Commission opted to recoup only half of it—approximately GHS488 million out of a GHS976 million debt. “The Commission, being mindful of the current economic difficulties for Ghanaians, decided to recover only half of the outstanding debts,” he said.
This approach, according to the PURC, reflects its ongoing effort to strike a balance between minimizing the impact of tariff increases on consumers and ensuring that utility providers remain financially capable of delivering reliable services. “This has always been the careful balancing act the Commission has had to do to minimise the impact of tariff increases on livelihoods while ensuring that the utilities are well-capitalised to keep the lights on,” Dr. Suleman added.
The tariff revision is part of PURC’s Quarterly Tariff Review Mechanism, which tracks and adjusts tariffs based on fluctuations in four key variables: the exchange rate, inflation, electricity generation mix, and fuel costs—primarily natural gas.
For the second quarter of 2025, the Commission used a weighted average exchange rate of GHS15.6974 to the USD, which resulted in an under-recovery of GHS0.1700 from the previous quarter. The applicable average projected inflation rate stood at 22.49%, and the weighted average cost of gas (WACoG) used was USD7.6289/MMBtu—down from USD7.8368/MMBtu in Q3 of 2024.
The projected hydro-thermal generation mix for Q2 2025 is 28.80% hydro and 71.20% thermal.
The PURC emphasized that the Quarterly Tariff Review Mechanism is essential to avoid both over-recovery—which places an unnecessary burden on consumers—and under-recovery, which compromises utility companies’ ability to maintain electricity and water supply. “Under-recovery has negative implications for the ability of the companies to supply electricity and water, and it has the potential to cause outages,” the Commission noted.
The remaining 50% of the outstanding GHS976 million will be distributed across future tariff reviews within the year.
SOURCES : CEO Doji | DBlog | www.digirefera.com
PHOTO & IMAGE CREDIT : CEO Doji / MC MULTIMEDIA
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