To tackle the growing challenges in Ghana’s energy sector, the government on yesterday June 3, introduced the Energy Sector Levies (Amendment) Bill, 2025.
This legislation proposes an increase in the levy designed to cover shortfalls and repay the sector’s mounting debts.
In response to this urgent situation, the government has introduced the Energy Sector Levies (Amendment) Bill, 2025.
Here is the Breakdown of the Memorandum
Purpose of the Bill
The government wants to change an existing law so it can increase a levy (tax) used to:
- Pay off debts in the energy sector
- Reduce energy shortages
- Stabilize electricity supply
Why This Is Necessary
-Ghana’s energy sector is facing serious challenges, there’s too much debt, not enough fuel, and the system is inefficient.
-As of March 2025, the sector owes about $3.1 billion USD to power producers, state companies, and fuel suppliers.
-Some international guarantees (from the World Bank and others) were fully used because Ghana couldn’t pay bills owed to energy companies like ENI and Karpower.
-The government estimates it needs an extra $632 million and $3.7 billion USD more to clean up the sector’s debts.
Problems in the Sector
- Ghana now relies more on thermal power (which needs liquid fuel) than hydro.
- But the cost of fuel is not included in the current electricity pricing.
iii. This means there’s not enough money to buy the fuel needed.
- The government estimates it will need $1.2 billion USD in 2025 just to buy fuel for electricity.
What the Government Plans to Do
- The government plans to increase the levy.
- Promise: Fuel prices at the pump won’t go up, thanks to a strong Cedi.
- The extra funds from the levy will go directly to support energy supply, especially to buy liquid fuel.
- The aim of the govt is to keep electricity stable and avoid blackouts while making the energy sector financially sustainable.
Conclusion
The bill is about raising more money from petroleum levies (but not raising petrol/diesel prices) to Pay energy sector debts, Buy fuel, Keep electricity supply stable and Prevent collapse of the energy system
