Former Minister for Finance, Dr. Mohammed Amin Adam, has accused the governing National Democratic Congress (NDC) of turning routine energy sector debt payments into a public relations exercise.
According to Dr. Amin Adam, settling energy sector arrears is neither novel nor extraordinary, insisting that similar payments were made by the previous New Patriotic Party (NPP) government without fanfare.
“Paying energy sector debts of US$1.4 billion is not new,” Dr. Amin Adam stated. “As captured in the 2025 Budget presented by the NDC government itself, the previous NPP administration paid about US$1.4 billion towards energy sector debts in 2024 without making noise about it.”
His comments follow a statement issued by the Ministry of Finance, which announced that the Mahama-led administration has paid US$1.47 billion to clear energy sector debts, presenting the move as a major policy achievement.
Dr. Amin Adam, who is also Member of Parliament for Karaga, maintained that while addressing energy sector challenges is necessary, it should not be politicised.
“Addressing energy sector challenges is not a big deal. It is a responsibility of every government,” he said.
Structural Problems Persist
During parliamentary debates last year, Dr. Amin Adam warned that Ghana’s energy sector continues to suffer from deep-rooted structural problems that cannot be solved by debt payments alone.
He stressed that the sector is plagued by serious inefficiencies that require urgent attention to ensure reliable, affordable, efficient and sustainable power supply in line with the government’s reset agenda.
“Mr. Speaker, the increasing energy sector financing shortfalls in recent times are posing significant fiscal risks to the country’s finances,” he told Parliament.
He attributed the persistent shortfalls to a combination of large collection inefficiencies, high distribution and system losses, and elevated generation costs arising from limited competition and low renewable energy penetration.
He further pointed to non-cost-reflective tariffs, persistent breaches of the Cash Waterfall Mechanism, and deep inefficiencies within state-owned energy enterprises. According to him, additional fiscal pressure is created by subsidies extended to some private sector operators, worsening the sector’s already fragile financial position.
US$1.5 Billion Paid in 2024
Dr. Amin Adam disclosed that in 2024, the Ministry of Finance supported the energy sector with payments amounting to about US$1.5 billion, equivalent to GH¢20.8 billion, to prevent a total collapse of the sector.
He lamented that these funds could have been channelled into critical development projects if inefficiencies within the energy sector had been addressed.
“These resources could have been used for roads, schools and hospitals if the sector inefficiencies were resolved,” he said.
Financing Gap Worsening
Despite the substantial payments made in 2024, Dr. Amin Adam revealed that Ghana’s energy sector financing gap continues to widen.
He cited findings from a recent exercise conducted by the Energy Sector Financing Modelling Team under the Energy Sector Recovery Programme (ESRP), which showed that the Business-as-Usual (BAU) financing shortfall has risen sharply.
According to the assessment, the energy sector financing gap is projected to reach US$2.23 billion in 2025, even after the heavy spending recorded last year.
Dr. Amin Adam warned that without bold structural reforms, debt payments alone would only provide temporary relief while deeper problems persist.
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The post NDC Turning Energy Debt Payments into PR Exercise – Amin Adam appeared first on The Ghanaian Chronicle.
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