The Food and Beverages Association of Ghana (FABAG) has strongly opposed the Public Utilities Regulatory Commission’s (PURC) proposed increase in electricity tariffs, warning that such a move could devastate businesses, trigger massive job losses, and undermine the government’s 24-hour economy agenda.
In a detailed statement, FABAG described the planned adjustment as “a recipe for disaster,” stressing that the food and beverage sector—already struggling under rising costs and a weakening cedi—cannot absorb further shocks.
“Food may be essential, but sales in the sector have plunged by 70%. Businesses are on the brink, and a tariff hike will only worsen the situation,” the statement said.
Tariff Hikes Will Hurt Households
FABAG argued that increasing electricity costs will deal a direct blow to Ghanaian households, particularly low- and middle-income families already stretched thin.
“For many families, electricity and water bills already consume a significant share of income. A further increase will force people to choose between keeping the lights on or putting food on the table.”
The Association warned of rising energy poverty, especially among women-led households and the rural poor, further entrenching inequality.
Inefficiency Shouldn’t Be Transferred to Citizens
FABAG questioned why citizens should bear the cost of inefficiencies in the energy sector:
“Should struggling traders, nurses, and small business owners continue to pay for poor performance in the utility sector?”
The group criticized the Electricity Company of Ghana (ECG) for operational inefficiencies, citing poor customer service and unresolved issues with prepaid meters.
“Many ECG staff have practically privatised their desks. These inefficiencies cannot be rewarded with tariff hikes.”
Inflation and Economic Impact
The Association warned that higher utility tariffs would trigger inflation across the economy, increasing the cost of food, transport, and housing.
“Utilities form the foundation of Ghana’s inflation drivers. An upward review will set off another wave of price hikes—for bread, kenkey, water, and beverages.”
FABAG cautioned that businesses, especially SMEs, are operating on thin margins, and any additional cost burden could lead to layoffs, downsizing, or closures.
AfCFTA Competitiveness at Risk
Higher tariffs, FABAG added, would threaten Ghana’s competitiveness under the African Continental Free Trade Area (AfCFTA), as local goods become more expensive than imports from countries with cheaper energy.
“This undermines industrialisation, deters investment, and derails the government’s 24-hour economy vision.”
Call for Reform and Protection
FABAG called on PURC to link tariff adjustments to performance benchmarks, rather than passing inefficiencies onto consumers.
“We demand Performance-Linked Tariffs—utilities must first cut losses, improve collections, and address internal waste.”
The group urged PURC to protect vulnerable households and support small businesses, proposing an expansion of lifeline bands and targeted relief for sectors under stress.
“Every cedi lost to inefficiency should not be paid by hardworking Ghanaians. A tariff increase without accountability is not reform—it is punishment.”
FABAG concluded by calling for a balanced approach:
“We urge PURC to put people first—phase any adjustments, demand efficiency, shield the poor, and support local businesses. That is the only sustainable path forward.”
