The rise in electricity prices: the untold story

Over the last few weeks there has been enormous outrage at the recent and significant increase in electricity bills for both domestic and commercial users.

It has even had the president to express comments about the nature of the increase.

However what many Ghanaians are not being told of is one of the fundamental reasons for this increase and who the real culprits are.

Many Ghanaians believe it is the likes of the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG) who are the culprits in this saga of electricity hikes but the REAL culprits are the government of Ghana and the World Bank/IMF.

I have stated continually that the World Bank's policies for countries like Ghana are the ROOT cause of some of the socio-economic problems that exist in countries like Ghana.

It is these very policies that are to blame for the steep increase in electricity bills that have been imposed upon the people of Ghana.

The reason for the steep increase in electricity bills can be traced back to last year when the current government went to the World Bank/IMF to get a loan to help it in the midst of the global financial crisis that was beginning to have an impact on Ghana.

It is important at this juncture for the readers to understand that bodies like the World Bank exert massive influence on the economies of countries like Ghana (circa Report Conditionality in World Bank crisis lending to Ghana).

In return for loans, financial assistance and aid, countries like Ghana are required to implement economic policy reforms as prescribed by the World Bank/International Monetary Fund (IMF).

These conditions which have been severely criticized by civil society groups, individuals, think-tanks and academics have all too often had adverse effects on the livelihoods of people especially the very poor and vulnerable in society.

When the World Bank/IMF approved loans to the Government of Ghana that amounted to US$535 million in 2009, one of the conditions was the Second Natural Resources and Environmental Governance Development Policy Operation.

Unknown to the vast majority of Ghanaians the aforementioned condition contained in it a clause that prompted the need to increase revenue in the electricity sector.

Therefore what the recent hikes in electricity imply that this was a condition that needed to be met in order for the government to be in the position to receive the aforementioned sum of money to help it balance its budget and help it stave off the effects of the global credit crunch.

However this recent hike in electricity has had a great effect on the poor and very poorest in Ghanaian society that ultimately undermines their right to energy.

This policy contradicts certain noises by the World Bank who claim that they want to help the government of Ghana reduce the high levels of poverty that are prevalent in the country.

It also contravenes the government's manifesto pledge to implement pro-poor policies as a means to reduce poverty in the country.

Access to electricity for both local populations and the business community are imperative for a country's developmental path. Therefore it is wholly unacceptable that a body and a government that claim to want to help the poor and industry generally, impose draconian policies that hinder the very people they claim to want to help.