The Northern Electricity Distribution Company (NEDCo) has called for reforms to Ghana’s electricity tariff structure, including the scrapping of the lifeline tariff and the introduction of a dedicated streetlight tariff.
While NEDCo is pushing for the removal of the lifeline tariff, the Electricity Company of Ghana (ECG), which is responsible for power distribution in the southern part of the country, is also proposing two tariff bands for residential customers and one for non-residential customers.
ECG argues that this new structure will simplify billing and improve customer understanding of electricity bills.
The company has also proposed the introduction of a dedicated streetlight tariff.
It would be recalled that, previously, lifeline consumers were those who consumed between 0–50 kWh of electricity.
However, this tariff band was reduced to 0–30 kWh following NEDCo’s proposal during the 2022–2025 Multi-Year Tariff Review.
Speaking at the PURC stakeholder engagement on the 2025–2029 Multi-Year Tariff Review, Mr. Hashim Iddrisu, NEDCo’s Director for Commercial Services, argued that the lifeline tariff—which provides subsidised electricity to low-consumption households—has become unsustainable and is causing the company to incur “huge losses.”
The utility company proposed that a uniform tariff system be applied to all residential customers, where bills are determined solely by consumption volumes, rather than differentiated unit prices.
According to NEDCo, this approach would align with pricing practices in other sectors such as fuel, where higher usage directly results in higher costs.
“We’re proposing that the current lifeline tariff be discontinued. We’re also recommending that a streetlight tariff be provided for residential customers so that they are no longer included in existing brackets.
“We further propose the introduction of a streetlight tariff to recover the costs associated with the provision of public lighting,” Mr. Iddrisu stated.
NEDCo further recommended that tariffs reflect the company’s actual capital expenditure (CAPEX), operational expenditure (OPEX), and return on investment to ensure financial sustainability.
The utility also urged the adoption of non-discriminatory tariffs, arguing that the cost of electricity production and distribution is largely uniform across customer groups.
On projected tariff adjustments, NEDCo outlined marginal increases over the review period—2% in 2026, 5% in 2027, 3% in 2028, and 0.04% in 2029—following a recorded reduction in 2023. These projections, the company noted, are based on the assumption of a 174% adjustment in the current year.
Source: https://energynewsafrica.com
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