COVID-19 reliefs: Ghana to spend GHc1bn on free electricity in three months

by Business Zone

Government is expected to spend approximately GHc1 billion to absorb the electricity bills of Ghanaians for the next three months as part of relief measures in the wake of the Coronavirus disease.

The amount is expected to cover an estimated population of about 4.8 million meters across Ghana.

The Minister of Energy, Mr John Peter Amewu, made this known at a press briefing in Accra on Thursday.

He said the amount would cover the electricity bills of consumers of the Electricity Company of Ghana (ECG), the Volta River Authority (VRA) and the Northern Electricity Distribution Company (NEDCo).

President Nana Addo Dankwa Akufo-Addo in his April 9 address to the nation on the measures being taken to address the challenges of the Coronavirus disease on Ghanaians, announced a package to absorb the electricity bills of all Ghanaians.

The president said government would fully absorb the electricity bills for people who consumed zero to 50 kw/h of electricity for the periods of April, May and June.

He added that, for residential and commercial users, government would absorb 50 per cent of the electricity bills using March 2020 as benchmark.

Providing a breakdown of the amounts to be expended in that regard, the Energy Minister explained that life-line consumers as defined by the Public Utility Regulatory Commission (PURC), where people who used only one television set, two lighting bulb points, a table top fridge and a fan for a limited number of hours.

According to Mr Amewu, ECG’s life-line population in Ghana is about 1 million cluster population, comprising about 27.4 percent of the total customers of ECG.

He explained that, “by cluster population we are talking about the number of meters and not the population of people.”

He stated that at the current tariff level, government would absorb approximately GHc8.5 million of the electricity bills of that population per month.

For non-life customers, Mr Amewu said a 50 per cent discount on their electricity bills would translate to GHc235.4 million for 278, 086 residential customers and 160,008 for special load tariff customers.

He said a total relief for ECG customers per month based on the estimated revenue would be GHc244 million per month translating to GHc732million for the 3 months, that is, April, May and June.

For NEDCo, Mr Amewu said a total government relief for all customers was about GH₵47 million per month or GHc141 million for the three-months period.

He said the reliefs comprised of about GHc10.9 million per month or GHc32.9 million for three months for a customer population of 569,000 life customers. The figure, he said, made up of 60.67 per cent of NEDCo’s total customers.

For non-life customers, he said, the figure was about GHc36 million per month or GHc108 million for three months for 369,000 non-life customers.

According to Mr Amewu, a total relief equivalent to GHc55.5 million per month or GHc166.4 million for 3 months would be spent.

He explained that  VRA’s customers comprised 12 mining companies, VALCO and other manufacturing customers such as Aluworks, Diamond Cement Limited, Savannah Cement Limited and Enclave Power Limited.

He said for VALCO, government would spend an estimated GHc42.4 million per month or GHc127.2 million for the three months.

VALCO is estimated to cost government GHc4.8 million per month or GHc14.4 million in total for the next three months, while the other manufacturing companies would cost GHc7.9 million per month or a total of GHc53.7 million for the three-months period.

Source: BusinessZone Online

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