The Public Utilities Regulatory Commission (PURC) has announced an upward review of tariffs for electricity and water for the second quarter of 2025, citing critical under-recoveries and a need to maintain utility service delivery in the country.
The average end-user tariff for electricity has been increased by 14.75%, while water tariffs have gone up by 4.02% across the board.
In a press release dated April 11, 2025, the Commission explained that the adjustment is part of its Quarterly Tariff Review Mechanism, which monitors four key variables: the Cedi/Dollar exchange rate, inflation, electricity generation mix, and the cost of fuel—primarily natural gas. These variables, the Commission says, are essential in avoiding both over-recovery and under-recovery of revenues.
“For the second quarter of 2025, a Weighted Average Exchange Rate of GHS15.6974 to the USD was used,” the statement indicated, adding that this reflected an under-recovery of GHS0.1700 compared to the last quarter of 2024.
An average projected inflation rate of 22.49% and a Weighted Average Cost of Gas (WACOG) of USD 7.6289/MMBtu were also key inputs into the tariff computation. The projected hydro-thermal generation mix for the quarter stands at 28.80% hydro and 71.20% thermal.
One of the major drivers of the tariff hike was the Commission’s decision to partially recover an outstanding GHS976 million in revenue carried over from 2024.
According to PURC, “A key variable that contributed significantly to the 2025 quarterly tariff adjustment was an inevitable attempt to pay half (50%) of an outstanding revenue of GHS976 million carried over from the previous three quarters of 2024.”
The Commission further stressed the importance of this review in sustaining utility operations: “The combined effect of the cedi/dollar exchange rate, inflation and the payment of 50% of outstanding revenues from the previous quarters in 2024, is that the utility companies are bleeding from serious under-recovery.”
Despite the adjustments, the Commission noted that a full recovery of outstanding revenues would have led to significantly higher tariff increases. “The Commission, being mindful of the current economic difficulties for Ghanaians, decided to recoup only half of the outstanding debts. This has always been the careful balancing act the Commission has had to do to minimize the impact of tariff increases on livelihoods while ensuring that the utilities are well-capitalised to keep the lights on.”
The tariff increases take effect on May 3, following the Commission’s decision announced on April 11.
