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Ghanaians unjustifiably pay more for local fuel distribution than importation costs from Europe — ACEP

Headlines Kodzo Yaotse, Policy Lead at ACEP
WED, 15 JAN 2025
Kodzo Yaotse, Policy Lead at ACEP

The Africa Centre for Energy Policy (ACEP) has revealed that Ghanaians are paying significantly more to transport fuel locally from depots to retail outlets than it costs to import fuel from Europe.

According to Kodzo Yaotse, Policy Lead for Petroleum and Conventional Energy at ACEP, consumers pay about 7 cents (GHS 1.16) per litre for local distribution, compared to 5 cents per litre for freight and insurance costs to ship diesel from Europe to Ghana.

“Consumers pay more for the product to move from the depot to their retail outlets than they do for the product to move from Europe to Ghana. This is significantly higher and unjustifiable,” Yaotse said at a press conference, presenting ACEP’s report on Downstream Petroleum Products Taxation in Accra on January 15.

He explained that the Primary Distribution Margin (PDM), which is intended to cover depot-to-depot transportation costs, is levied even when Bulk Oil Storage and Transportation (BOST) facilities are not utilized.

“The PDM generates over GHS 1.2 billion annually. Yet more than 50% of petroleum products are distributed outside of BOST facilities. This raises concerns about the justification for this fee,” Yaotse stressed.

ACEP recommended the need to review and restructure petroleum levies to ensure they serve the interest of consumers and contribute meaningfully to national development.

Isaac Donkor Distinguished
Isaac Donkor Distinguished

Is a journalist with a keen interest in politics, current affairs, and social issuesPage: isaac-donkor-distinguished

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