One of Ghana’s downstream sector advocacy groups, Chamber of Petroleum Consumers (COPEC), is calling on the President of the West African nation to scrap the Stabilization Levy.
The group argues that the levy serves no purpose since Ghana has deregulated its downstream petroleum sector.
Discussing issues affecting the prospects in the energy sector on Energy 101 programme aired on a local radio station, Asaase Radio, in the nation’s capital, the Head of Research and Training Unit at Chamber of Petroleum Consumers-Ghana (COPEC), Benjamin Nsiah said over the years, the stabilisation levy has not been activated in times of hikes in the price of petroleum products, therefore, making the law ineffective and non-beneficial to ordinary consumers.
He further argued that during last year’s Christmas festivities, prices started going up and the government of Ghana should have activated the stabilisation levy to cushion consumers since the impact of Covid-19 had affected the finances of many people but that was not the case.
According to him, since covid-19 was normalising and production in the sector started, it affected demand and supply which also affected price of the product at the international market.
Therefore, this automatically impacted on Ghana’s petroleum prices.
“We at COPEC have been calling for the scrap of the Stabilization Levy because, now we have a deregulated market and it means that our petroleum prices should be able to determine the price for themselves,” he stated.
Mr. Nsiah also argued that per the deregulated policy in operation in Ghana, it does not mean that any time there is a problem with prices of petroleum products, either suppliers or consumers could just advocate triggering of the stabilisation levy to cushion either of them.
“Based on demand and supply, we should be able to determine prices of products so no one or institution sits somewhere and thinks that because we are in a deregulated market, there is a levy called price stabilisation levy so any time we could cushion petroleum suppliers or petroleum consumers, depending on how you look at it with that particular levy,” said Mr. Nsiah.
During the Christmas period, prices of petroleum products in Ghana were increased marginally at the pumps.
Consumers complained about how difficult it was for them to buy the products.
It was for this reason that stakeholders were advocating for the activation of the stabilisation levy to cushion ordinary consumers in such circumstances.
COPEC said the time is due for Ghana to look at that particular price law because it has not been used actually over the years.
The Energy Sector Act is to use the Stabilisation and Recovery Levy as a major source of subsidising the various products, especially for premix fuel and residual fuel in Ghana.