The International Monetary Fund has disclosed that Ghana’s Electricity Company is being prepared for transfer into private hands, as the government moves toward a new management model for the nation’s power distribution network.
According to details contained in the Fund’s Staff Report on Ghana, a transaction advisor is expected to be engaged before the close of 2025 to supervise the competitive process that will select private concessionaires to assume control of electricity distribution operations.
The report further notes that stability within the energy sector is gradually improving, pointing out that payments made by the Electricity Company of Ghana (ECG) to independent power producers through the cash waterfall mechanism have risen sharply — hitting US$308 million in just the first half of 2025, compared with a total payout of US$325 million recorded for the entire year 2024.
As of the end of June 2025, outstanding net payables owed to independent power producers stood at US$1.2 billion — an increase of US$71 million since the end of 2024 — while debts to fuel suppliers amounted to US$830 million, reflecting a decline of US$124 million over the same period.
The Fund explained that the surge in unpaid balances to IPPs during the first half of 2025 was largely the result of a sharp drop in direct government payments to these producers, which outweighed the significant rise in ECG’s own settlements.
By the third quarter of 2025, the government had reached an agreement with nine major independent power producers — covering almost all outstanding obligations — on a sweeping repayment arrangement for legacy arrears accumulated up to June 2025. The deal includes steep reductions of between 15 and 30 percent, substantial upfront disbursements of about US$300 million in 2025, and additional instalment payments scheduled twice yearly from 2026 through 2029.
Separately, the IMF report indicates that government has committed to clearing its outstanding debts to Sankofa — the largest gas supplier and holder of more than half of all arrears owed to fuel providers — no later than April 2026.
