The government has presented a Legislative Instrument (LI) to Parliament that mandates all future power generation contracts to undergo competitive bidding, as part of its initiative to address inefficiencies in Ghana’s energy sector.
The Minister of Finance, Dr. Cassiel Ato Forson, made this announcement on April 23, 2025, during a session of the Ghana Energy Compact under Mission 300, organized by the World Bank in Washington. He stated that the proposed regulation aims to enhance transparency in power procurement and ensure better value for money.
‘We have submitted the LI to Parliament to establish competitive procurement of power plants as the standard practice,’ Dr. Forson remarked. ‘If we are committed to resolving the entrenched issues in the energy sector, this is an essential measure.’
Dr. Forson characterized the energy sector as the nation’s most urgent economic challenge, disclosing a current financial deficit of approximately US$2 billion.
He attributed a significant portion of this gap to inefficiencies throughout the energy value chain, particularly within the Electricity Company of Ghana (ECG).
Dr. Forson indicated that the ECG could potentially halve its shortfall by resolving its internal issues. He emphasized that it is unacceptable to continue transferring these losses to consumers.
He further explained that the Legislative Instrument (LI) is part of a larger initiative aimed at instilling greater discipline in the procurement process, thereby ensuring that the costs associated with mismanagement do not burden the Ghanaian public through increased tariffs and levies.
Dr. Forson urged Parliament to prioritize the swift passage of the LI, highlighting that the success of the Ghana Energy Compact relies on prompt and decisive action. He concluded by stating, ‘Time is of the essence.’
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