President Mahama defends GHC1 fuel levy as crucial step to save energy sector, stabilize economy

President John Dramani Mahama has firmly defended the government’s decision to introduce an additional GHC1.00 levy per litre of fuel, describing it as a necessary and justifiable measure to address Ghana’s mounting energy sector debts and ensure long-term economic stability.

Speaking at the Jubilee House on Tuesday during the official presentation of the final report of the National Economic Dialogue 2025, the President acknowledged widespread concerns from the public but stressed that the move is essential to avert an energy crisis that could cripple national productivity and industrial growth.

According to the President, Ghana’s energy sector is weighed down by a legacy debt of over $3.1 billion, with an additional $1.8 billion needed in the short term to finance fuel procurements for uninterrupted thermal power generation. He warned that failing to tackle this head-on could result in devastating consequences for the country’s economy.

“The dialogue recognizes growing energy sector liabilities as the greatest existential threat to fiscal consolidation and macroeconomic stability. Our energy sector carries a dead burden of over $3.1 billion with an estimated $1.8 billion more required to finance fuel procurements for uninterrupted thermal power generation in the coming months.

“If left unaddressed, this situation significantly threatens national productivity and industrial growth. While we have devised a strategy to liquidate this debt and staunch the bleeding in the power sector, we must take advantage of recent gains created by appreciation in the value of our currency to accelerate the solution to our energy sector challenges.” He said.

In response to recommendations from the National Economic Dialogue, Parliament on Monday approved amendments to the Energy Sector Levies Act, including a GHC1.00 increase in the Energy Sector Recovery Levy. The President emphasized that this difficult but prudent decision was made with a clear objective.

President John Dramani Mahama assured that the funds will not be subjected to the “hazards of the consolidated fund,” a common concern regarding financial mismanagement. Instead, a dedicated fund will be created and regularly audited, with audit reports made public.

“In line with the dialogue’s recommendation to boldly tackle the crisis in the energy sector, Parliament yesterday approved an amendment to the Energy Sector Levees Act and the certificate of agency introducing a GHc1.00 increase in the energy sector recovery levy. This decision, though difficult, is necessary and justifiable.

“The additional revenue projected is GHc5.7 billion annually. This revenue will be strictly reinforced to pay down legacy energy debts, finance ongoing fuel purchase, and avert the risk of recurring power shortages.

“Funds from this levy will not be subject to the hazards of the consolidated fund and the minister is here, I know when money falls into the consolidated fund, it faces certain hazards. It will not be subject to the hazards of the consolidated fund. The fund will be regularly audited and audit reports made public to ensure its transparent use.” He stated.

Source: Elvisanokyenews.net