By Grace Princess Tarwo/ Priscilla N. Nyamekye, GNA
Accra, Jan. 17, GNA – The Ghana Water Company Limited (GWCL) is indebted to Energy Providers to the tune of GH?671.8 million at the end of June 2018, which summed up to about 69.2 per cent of its annual water revenue of GH?970.6 million.
The GWCL attributed the huge indebtedness to its inability to fully settle the average monthly bills of GH?32.8 million, which constituted about 38 per cent of the company’s operating expenditure to its energy suppliers.
A GWCL document obtained by the Ghana News Agency in Accra on Thursday said it was now committed to a monthly loan repayment of US$ 7.91 million, which is 65 per cent of its average monthly revenue.
The company said the Ministry of Finance (MOF) was therefore currently implementing a policy of on-lending grants and loans, which had been contracted for projects of GWCL, seven of such on-lending agreements it said had been signed with the MOF totalling a little over USD 1billion.
The company said in spite of its challenges it had undertaken a number of interventions in recent times with the total cost of USD 643 million all aimed at improving efficiency and service delivery, justifying every pesewa paid by customers in terms of water tariffs.
It said it had embarked on a number of improvement projects to further reduce system losses and sustain production of its water plants.
The GWCL said it undertook several pipeline replacement works, storage tanks maintenance and water treatment plants repair works in several locations nationwide all at a cost GH?18.5 million.
It said other improvement projects included customer service, which aimed at enhancing the efficiency and deployment of smart customer meters that would give accurate reading of meters and billing where customers could receive bills via emails and SMSs as well as making of payments electronically from any part of the world.
It however explained that some of the major issues included, inadequate tariff to carry out repairs of assets. Its Operating Cost Coverage Ratio for 2017 was 111 per cent, which was suppressed due to difficulty in raising sufficient cash to fund all the maintenance activities, this is much less than the internationally accepted norm of 130 per cent to 160 per cent.
The GWCL said the importation of the water treatment equipment and chemicals had been affected adversely because, the average tariff per cubic meter in 2015 was USD1.49 but had reduced to about USD1.21, due to the depreciation of the Cedi.
It called on the Public Regulatory and Utility Commission and other stakeholders to provide every necessary support to enable the company to become a “world class utility company”
Meanwhile the Public Utility Regulatory Commission (PURC), has assured the public that it would strike a fair balance between utility service providers and utility consumers in determining new utility tariffs.
Mr Ishmael Agyekumhene, the Chairman of the PURC Technical Committee, announced this at a public hearing in respect of the 2019 Tariff Review for Electricity and Water organised by the Commission in Accra.
He said the Commission would consider a number of factors before agreeing to an upward tariff adjustment or otherwise.
Mr Agyekumhene, who presided over the meeting, said the PURC would go into a caucus meeting to consider the tariff adjustment proposals made by the utility service providers and chart the way forward.
He asked Ghanaians to collaborate with the PURC and utility service providers to clamp down on illegal power connection and waste in the system, noting that, the energy sector could have either positive or negative impact on the Ghanaian economy depending on how its managed.
Representatives from the Electricity Company of Ghana (ECG), Ghana Water Company Limited (GWCL), Northern Electricity Distribution Company (NEDCo), Ghana Grid Company Limited (GRIDCo) and Enclave Power Company Limited (EPC) made various presentations to justify their proposed tariff adjustment in order to reflect their operational costs.
The ECG proposed 23 Ghana pesewas upward tariff adjustment per kilowatt hour (23p/KWh), GRIDCo 4.897 Ghana pesewas per kilowatt hour (4.897p/KWh), NEDCo 43 Ghana pesewas per kilowatt hour (43p/KWh) and EPC proposed 26 Ghana pesewas per kilowatt hour (26p/KWh) for the 2019 Utility Tariff Review.
GNA
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