Benjamin Boakye, Executive Director of the Africa Centre for Energy Policy (ACEP), has raised alarm over the critical state of Ghana’s energy sector. He described it as being “systematically decimated” due to inefficiencies and poor management, which have caused immense economic strain. In an opinion piece directed to President-elect John Mahama, Boakye detailed the urgent challenges the sector faces, warning that failure to address them could further destabilize the economy.

According to Boakye, the energy sector wastes over GH¢50 billion annually—a figure that far exceeds Ghana’s yearly oil revenue. He attributed this waste to structural inefficiencies, including a proliferation of redundant agencies and companies.

“The sector is burdened by entities that are four to five times larger than necessary compared to eight years ago,” he explained. He blamed this overstaffing on politically motivated appointments, which have resulted in unnecessary directorates and institutions, all funded at the public’s expense.

Boakye also criticized the deteriorating state of the Electricity Company of Ghana (ECG), which he described as a major financial liability. “Political interference has rendered ECG the largest drain on the national budget,” he noted. This mismanagement, combined with procurement irregularities and currency exchange issues, has placed significant pressure on the upstream oil and gas sector, leaving gas payments to investors increasingly uncertain.

The downstream petroleum sector is also plagued by inefficiencies, Boakye added. He highlighted the existence of inflated margins, which he termed the “black tax,” amounting to over GH¢6 billion annually. He argued that redirecting this wasted revenue could fund critical development needs.

Boakye further warned of a sharp decline in the upstream oil and gas sector, stressing the urgency of rebuilding investor confidence. He noted that with strategic reforms, the sector could attract $2 billion in investments by 2025, out of a possible $6 billion over the medium term.

Calling for bold and decisive action, Boakye urged President-elect Mahama to conduct a thorough review of the sector and implement reforms to restore efficiency and accountability. “A surgical examination of the energy sector is imperative,” he concluded.

Source: TheDotNews