The Public Utilities Regulatory Commission’s (PURC) validation reports on the Cash Waterfall Mechanism (CWM) have uncovered that the Ministry of Finance is indebted to certain power generators to the tune of about GH₵1.28 billion, amid ongoing challenges with erratic power supply in Ghana.
The validation reports, covering the period from August 2023 to February 2024, indicate that the Finance Ministry has failed to fulfill its ‘top-up’ obligations under the revised CWM, resulting in total arrears of approximately GH₵1.28 billion.
The February 2024 validation report specifically notes that the Finance Ministry has not made up for shortfalls since August 2023. In February 2024, the Ministry was expected to release an amount of GH₵197,112,973.25, according to the CWM guidelines and the approved model.
Since October 2023, the top-up amount has consistently exceeded GH₵200 million before slightly dropping to GH₵197.11 million in February 2024. In February 2024, eight State Owned Enterprises, including GRIDCo, Bui, and VRA, were slated to receive over GH₵197 million from the Finance Ministry for power generation and transmission under the CWM.
These payments are crucial for addressing shortfalls in the Level B category, preventing arrears from accumulating in the power sector, and facilitating the purchase of gas for electricity generation to ensure uninterrupted power supply.
Despite the PURC issuing payment instructions on behalf of the CWM to the Ministry of Finance since August 2023, the Ministry is yet to comply with these directives.
According to the revised Cash Waterfall Mechanism, “Level A payments shall be made to IPPs directly by ECG and Level B payments to SOEs and fuel suppliers”.
February 2024: MoF top-up
January 2024: MoF top-up
December 2023: MoF top-up
November 2023: MoF top-up
October 2023: MoF top-up
September 2023: MoF top-up
August 2023: MoF top-up
