PURC announces reduction in tariffs effective in March

February 15, 2011 Accra, Feb. 15, GNA - Consumers of electricity and water will see a reduction in tariffs from March 1, following the decision of Public Utility and Regulatory Commission (PURC) to review tariffs downwards.

From March 1 to May 31, this year, the following new electricity and water rates as reviewed by the PURC using the revised Automatic Tariff Adjustment Formula (AAF) will apply.

On electricity, consumers within the 0-50 units bracket will still pay 9.5 pesewas per kilowatts hour, 51-150 and 151-300 will now pay 15.95 pesewas, down from 17 pesewas while those in the 301-600 bracket will pay 20.7 pesewas down from 21 pesewas.

To further reduce the burden on the lifeline consumers, the electricity service charge had been reduced to GH¢1 from GH¢1.50.

For water, residential consumers within 0-20 cubic metres would pay 79.05 pesewas instead of 80 pesewas and those who consumed above 20 cubic metres will now pay 118.5 pesewas instead of 120 pesewas previously.

Dr Emmanuel Annan, Chairman of PURC, who announced the decision at a press conference in Accra on Tuesday, said the Commission's approval of a reduction in both electricity and water tariffs was influenced by the availability of natural gas from Nigeria through the West African Gas Pipeline and a high hydro component in the generation mix.

He said the AAF was aimed to ensure quarterly review, taking into account the movements in external factors in order to preserve the real value of tariffs approved for the utilities.

The AAF takes into consideration the world market crude oil price, Cedi-US dollar exchange rate, the consumer price index and the hydro-thermal generation mix.

Dr Annan said compressed gas and the high level of hydro generation had together reduced the cost of electricity generation despite the increasing trend in the price of crude on the world market.

"It is expected that the availability of compressed natural gas in the next quarter may indicate further reductions," he said.

Dr Annan said the review also took into account the cost of production of the utilities and their investments, adding that tariffs excluded Value Added Tax and National Health Insurance.

He asked Electricity Company of Ghana, Northern Electricity Department and Ghana Water Company Limited not to bill customers for electricity and water consumed in February except those that fell within the March billing cycle.

Dr Annan tasked the utility service providers to ensure the highest standard of service delivery.

He urged consumers to pay their bills on time as well as report illegal practices that undermined the operational and financial viability of the utility companies.

GNA