Energy expert, Benjamin Nsiah, has highlighted inefficiencies within the Electricity Company of Ghana (ECG) as a significant contributor to the country's growing energy sector debt.

Reacting to news reports that the ECG is burdened with approximately $2 billion in debt, Mr. Nsiah pointed to persistent waste in the company's energy distribution system as a major factor behind the financial crisis.

Speaking on Accra 100.5 FM’s evening news on Thursday, September 19, 2024, Mr. Nsiah responded to remarks made by John Jinapor, Ranking Member of Parliament’s Energy Select Committee, regarding the alarming state of ECG’s finances.

Mr Nsiah explained that both technical and commercial losses have played a significant role in worsening ECG's debt situation.

A key issue, he noted, is the importation of substandard meters, which have proven costly over time.

“The ECG spends large sums of money to import meters to improve efficiency, but many of these meters turn out to be unfit for long-term use, becoming a financial drain on the company,” Mr. Nsiah stated.

In addition to equipment-related inefficiencies, Mr Nsiah, who is the Director of Centre for Environmental Management and Sustainable Energy (CEMES) emphasised the need for a thorough technical audit of ECG’s financials to accurately assess the scope of the company’s debt. Without such an audit, he warned, the ECG is likely to continue accumulating more debt.

Another significant factor driving ECG's financial woes is the non-payment of debts by Ministries, Departments, and Agencies (MDAs).

Mr Nsiah revealed that even the Ministry of Finance owes the ECG several million Ghana Cedis in unpaid bills, further exacerbating the company’s precarious financial position.

Given the scale of ECG’s financial challenges, Mr Nsiah argued that privatisation may be the only viable solution to preventing the company from plunging deeper into debt.

“We need to rethink how the ECG operates. Privatisation is the only way out of this continuous debt situation,” he concluded.