A former Member of Parliament for Dormaa East, Paul Apraku Twum Barimah, has said with the stability of the cedi against the US dollar, Ghanaians must enjoy reduction in tariffs to reflect the general stability.
The Ghanaian cedi has experienced a significant appreciation against the US dollar in recent months, prompting calls for a corresponding reduction in electricity tariffs.
“It is sad that in spite of this currency strength, the Public Utilities Regulatory Commission (PURC) implemented a 14.75 per cent increase in electricity tariffs effective May 3, 2025, citing factors such as exchange rate fluctuations, inflation and fuel costs,” Barimah told journalists in Accra.
Giving a background, he stated that as of May 21, 2025, the cedi strengthened to GHS12.22 per US dollar, marking 8.44 per cent year-to-date gain from GH¢16.53 in November 2024.
This appreciation is attributed to several factors, including the Bank of Ghana's $490 million in forex interventions, increased gold reserves and improved gross international reserves, which stood at $9.4 billion in March 2025, up from $6.2 billion a year prior,” he added.
Tariff hike
The PURC's recent tariff adjustment was based on a weighted average exchange rate of GH¢15.6974 per US dollar, higher than the current rate.
At that time, the Commission cited the need to recover 50 per cent of an outstanding revenue shortfall of GH¢976 million from previous quarters in 2024 as a significant factor influencing the increase.
Stakeholder reactions
Recalling stakeholders’ reactions, Barimah noted that the Ghana Hotels Association and the Ghana Union of Traders’ Association (GUTA) had expressed concerns over the tariff hikes.
The Hotels Association highlighted that electricity accounts for over 20 per cent of operational expenses, warning that the increase could threaten business sustainability. GUTA criticised the PURC's decision as unjustified, pointing to inefficiencies in the utility sector that burden consumers,” he said.
Tariff reassessment
He said given the cedi's appreciation, stakeholders were arguing that electricity tariffs should be reassessed to reflect the reduced cost of importing fuel, which was priced in the US dollar.
He believed that if currency depreciation justified tariff increases, then the currency appreciation should logically lead to reductions, providing relief to consumers and businesses alike.
Looking ahead
As the cedi continues its upward trend, there is growing pressure on the PURC to consider these gains in future tariff reviews.
“Stakeholders advocate a transparent and responsive pricing mechanism that aligns with economic indicators, ensuring that consumers benefit from favourable market conditions.
So, the ongoing stabilisation of the cedi must lead to reduction in electricity tariffs,” Mr Barimah stated.
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