Ghana: ECG Declares Gh¢625.34 Million As Bad Debt

Ghana’s southern power distribution company, ECG, has declared Gh¢625.34 million (equivalent of US$80,668,860) as bad and doubtful debts over three years spanning 2019 to 2021.

In 2019, ECG made provision for Gh¢58.51million as bad and doubtful debt in line with the company’s policy.

The figure shot up to Gh¢276.50 million and Gh¢290.33 million in 2020 and 2021 respectively.

These figures were contained in ECG’s 2022-2026 tariff proposals submitted to the Public Utilities Regulatory Commission (PURC) for consideration.

“This is based on the company’s policy on provision for bad and doubtful debts,” ECG said.

“Majority of these bad debt emanates from demolished structures due to road constructions, relocation of slums, removal of temporary structures, illegal transfer and removal of meters by unscrupulous customers (mostly SHEP areas),” it explained.

Touching on the measures being adopted to minimise the bad and doubtful debts, ECG said it regularly engages Districts and Municipal Assemblies to ensure that information on demolishing exercises, road constructions, etc. are communicated to ECG in good time to avoid this problem.

It, however, noted that despite bad and doubtful debts being part of the company’s policy, the board, for the past 10 years, has not approved them even though the necessary provisions were made in the budgets.

Source: https://energynewsafrica.com