GHANA’S POWER SECTOR DEBT: ARE WE SLIDING BACK INTO LOAD-SHEDDING?

GHANA’S POWER SECTOR DEBT: ARE WE SLIDING BACK INTO LOAD-SHEDDING?

By A.K.Zabari Jnr

Ghana’s power sector is once again under severe financial strain. After nearly a decade of relative stability in electricity supply, warning signs are emerging that suggest a return to the disruptions that defined the "dumsor" era between 2012 and 2016.

In 2026, Independent Power Producers are reporting arrears running into hundreds of millions of dollars. The Electricity Company of Ghana continues to grapple with low revenue recovery, technical losses, and unpaid bills from both public and private institutions. At the same time, rising global fuel prices and fiscal constraints under the IMF programme have limited the government’s ability to subsidize the sector.

The question is no longer whether challenges exist. The question is whether we are doing enough to prevent another systemic collapse.

Current estimates place Ghana’s power sector debt above $2.5 billion. IPPs, who provide a significant share of thermal generation, have signaled that sustained non-payment could force plant shutdowns. ECG’s collection inefficiencies mean that for every cedi billed, a significant portion is lost to theft, poor metering, and delinquency.

This is not a new problem. It is a structural one. Successive governments have postponed difficult tariff and governance reforms, leaving the sector in a cycle of debt and underinvestment.

Unreliable power has consequences beyond inconvenience. It raises the cost of doing business, undermines productivity, and erodes investor confidence. During the last power crisis, the Bank of Ghana estimated that GDP losses exceeded $2.1 billion.

Today, small and medium enterprises — which employ the majority of Ghanaians — are most vulnerable. A cold store in Accra Central, a welding shop in Suame, a tech startup in East Legon: all face the same reality of paying for grid power and maintaining expensive backup generation. For students and health facilities, the impact is on learning outcomes and service delivery.

In an economy pursuing a 24-hour economy agenda, reliable power is not a luxury. It is foundational infrastructure.

Addressing this requires political will and policy consistency, not ad hoc interventions.

First, revenue mobilization must improve. ECG must accelerate the deployment of smart metering, enforce collection from all categories of customers including government agencies and reduce commercial losses.

Second, IPP obligations must be honored. Renegotiations should aim for sustainability, but credibility with investors depends on predictable payment. Without this, future capacity expansion will stall.

Third, the energy mix must diversify. Targeted investment in solar for public institutions and incentives for private sector adoption of renewables can reduce dependence on expensive thermal fuel. Energy efficiency must also become a national priority.

Finally, tariff policy must reflect cost while protecting vulnerable consumers. Blanket subsidies are fiscally unsustainable. A targeted approach is necessary.

Ghana cannot afford another cycle of debt, load-shedding, and lost economic output. The technical capacity to generate and distribute power exists. What is required is financial discipline and governance reform.

The 24-hour economy envisioned by policymakers will remain an aspiration if it is built on an unstable power base.

As a nation, we must decide: do we continue to manage symptoms, or do we resolve the underlying disease? The lights we keep on today will determine the economy we build tomorrow.

A.K.Zabari Jnr

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