Ghana: Civil Society Group CEMSE Calls For Disclosure Of State Energy Firms’ Performance Contracts

Ghana’s State Interest and Governance Authority (SIGA) and the Ministry of Finance should publicly disclose annual performance contracts signed with state-owned entities in the energy sector, the Center for Environmental Management and Sustainable Energy (CEMSE) said.

CEMSE Executive Director Benjamin Nsiah said greater disclosure would allow the public and other stakeholders to assess the targets set for state entities and monitor their performance.

Performance contracts are intended to establish targets for financial performance, operational efficiency and service delivery between the government and specified state entities.

The call comes after SIGA released its 2024 State Ownership Report, which showed significant revenue growth in Ghana’s energy sub-sector but also high financing costs that contributed to a consolidated net loss of 9.67 billion Ghana cedis.

The report showed financing costs of 9.39 billion cedis, offsetting operational gains in the sub-sector.

State power distributor Electricity Company of Ghana (ECG) has continued to face financial challenges, while the Energy Ministry has signed new performance agreements aimed at improving efficiency, according to CEMSE.

Nsiah said publishing the agreements would enable stakeholders to determine whether performance targets were realistic and assess whether management had met its commitments.

“Disclosing these contracts would empower stakeholders to assess whether targets are realistic, monitor compliance, and hold management accountable for results,” Nsiah said.

Regulation 196 of Ghana’s Public Financial Management Regulations, 2019 (L.I. 2378), requires specified state entities to enter into annual performance compacts with the finance minister, based on advice from SIGA.

CEMSE said, however, that the public currently has limited access to the contents of the agreements, creating an information gap over the performance expectations placed on state entities.

SIGA’s 2024 report covered 70 specified entities.