The Food and Beverages Association of Ghana has demanded immediate suspension of recent utility price increases, arguing that chronic inefficiency and financial waste at state utilities make the new charges unjustifiable. FABAG says consumers should not bear the burden of operational failures at the Electricity Company of Ghana and Ghana Water Company Ltd.
The Public Utilities Regulatory Commission approved a 9.86 percent increase in electricity tariffs and a 15.92 percent rise in water tariffs, effective January 1, 2026, as part of its Multi-Year Tariff Review covering 2026 to 2030. The increases affect all customer categories, including residential, commercial, industrial and public consumers, though service fees remain unchanged.
FABAG rejected the adjustments in a statement issued Sunday, calling them unacceptable and insensitive. The Association pointed to findings by Parliament’s Public Accounts Committee that exposed serious financial irregularities at ECG. According to FABAG, ECG exceeded its approved 2023 budget by GHS 189.2 million without authorization and saw procurement spending surge from under GHS 1 billion to over GHS 8.3 billion, representing what the group described as nearly 700 percent overspending.
The Association also highlighted technical and commercial losses at ECG exceeding 30 percent, which it said ranks the utility among the worst performers in Africa. FABAG questioned why PURC would approve tariff hikes when no credible plan exists to reduce these losses. The group emphasized that inefficiency, revenue leakages, corruption and poor service delivery are the real drivers of the sector’s instability, not inadequate pricing.
FABAG described ECG and GWCL as “a real cancer in the economic development of Ghana,” arguing that the utilities now drain productivity instead of supporting national growth. The Association said ECG has become the very disease it was created to cure, adding that years of mismanagement have eroded public trust and confidence.
The Association drew attention to the gap between public sector wage increases and utility tariff hikes. While government increased salaries by 9 percent, combined utility tariffs rose over 25 percent, intensifying pressure on businesses and households already struggling with high living costs. FABAG warned that the increases could trigger job cuts, production delays and higher prices, especially in the food and beverage sector where stable power and water supply is essential.
FABAG Chairman Reverend John Awuni told media that Ghanaians should not subsidize waste and managerial incompetence. He noted that ECG lost 32 percent of all electricity purchased in 2024, far exceeding the PURC benchmark of 21 percent. Between August 2023 and July 2024, ECG collected only 43 percent of the total revenue it billed, despite recording earnings of GHS 11.5 billion, of which GHS 8.6 billion was officially declared.
The Association is demanding immediate suspension of the tariff increase, a full operational audit of ECG and GWCL with public disclosure, an aggressive loss reduction program with measurable quarterly targets, enforcement of accountability including prosecution for internal theft and illegal connections, and a cost recovery model based on efficiency rather than continuous tariff hikes. FABAG emphasized that Ghana cannot tax or tariff increase its way out of a broken power and water sector.
The group urged that restructuring, digitization, accountability and proper revenue management are the real solutions, not burdening struggling businesses with higher costs. FABAG insisted that structural reform must be the priority, arguing that utilities should be reset before consumers are asked to shoulder higher charges. The Association concluded by emphasizing that Ghana deserves power and water sectors that work, not systems that survive by punishing their users.
According to PURC, the tariff adjustments follow extensive investment hearings, stakeholder consultations and regional public forums. Officials cited rising capital expenditure requirements, macroeconomic pressures and projected inflation as driving factors. The Commission projected a 2026 generation mix comprising 78.79 percent thermal power, 20.90 percent hydroelectric and 0.31 percent renewable sources, with transmission losses expected to increase from 4.10 percent to 4.40 percent and distribution losses rising from 21.40 percent to 24 percent.
FABAG said it will continue defending the interests of its members and the wider public, insisting that Ghanaians should not pay for inefficiency. Until ECG and GWCL demonstrate measurable improvements, including loss reduction, financial discipline and transparency, the Association maintains that tariff hikes should be suspended.
