The Alibi Has Not Changed - ECG

The electricity company of Ghana has recently made some proposals to the PURC for tariff increases which is believed to be in the region of 214%. I dare say that, any institution that comes up with such an astronomical demand for tariff increase in one hit is clearly an institution without a leader.


What is the excuse this time round? Well, the usual alibi with which they have conned consumers to have their proposed tariff increases approved over the years hasn�t changed � �we need to increase tariff to enable us improve on our services�. After years of consistently increasing tariffs, ECG�s services have not improved in anyway; in fact, it has rather gotten worse and indeed spiced up with corrupt practices by operatives of the institution.

The idea that ECG can only improve on their services by burdening the people of Ghana with such inconsiderate tariff increases is evidence enough that the leadership has failed to be innovative and efficient; because, there are other options available to management in dealing with the difficulties they have saddled themselves with.

It is alleged that, ECG is unable to retrieve millions of Cedis owed them by �big firms� as well as Government Ministries and Agencies. ECG has lost so much credibility and the public has no faith in them at all; they have in fact overdrawn their trust account with consumers. To claw back some credibility, ECG for a start, should demonstrate how effective they can be by collecting all the debts that is owed them and inject some efficiency savings into their operations.

Suffice to say that, one cannot even trust the current management to run the bath, let alone an institution that is the nerve centre of our economic development and industrialisation aspirations, because innovation and strategic management have completely eluded them.

Have they really thought about the consequences this tariff increase could have on businesses and consumers alike? Rising cost of energy will significantly increase the cost of production and create risks for companies that rely heavily on electricity for their productive processes � especially, where margins are narrow and consumers are price sensitive.

There is no denying the fact that, consumers will have to pay realistic prices for electricity in the long run, but the introduction of full cost recovery or removal of subsidies must be phased in over a number of years in tandem with efficiency savings. This will allow businesses to plan and rethink their strategy, and ultimately attract independent power producers (IPPs) into the industry.

There are many financially sound ways of improving service delivery and customer satisfaction as well as freeing up resources internally for capital investment. The institutions inability to overcome its capital constraints is due to the lack of skill, managerial talent, vision and proactive leadership.

ECG must adapt just as all business models, evolve to incorporate reduction in systemic waste and leakages. Increased efficiency and the associated reduction in the cost of generation will directly benefit consumers.

ECG must also focus much effort on end-use conservation by shifting consumer and business mind-sets to think ��sustainability�� through education, � this will ease the demand burden on the national grid. Systems change most decisively when individuals alter their way of thinking and therefore their behaviour.

Thus far, it is clear that, this vital institution which has critical impact on the economic health and productivity of Ghana is stuck in the past, and must be dragged amidst kicking and shouting into the 21st century, to embrace sustainability, efficiency savings and lateral thinking. Indirectly asking customers to pay for anticipated capital investment is an archaic and unproductive style of management.

The PURC and Government should therefore kick against the proposed tariff increase, and ask the management of ECG to do what they are paid to do, that is to engage the computer between their ears to deliver efficiency and value for money without burdening the consumer unnecessarily.

Consumers and businesses cannot continue to pay for the failure and inefficiency of leadership and management in our public institutions. In making appointments to these institutions by Government, the overriding factors should be skill, talent and character, over and above reward for political loyalty and patronage. I really do not care about the political colours, tribe or religious background of who is put in charge of these vital state institutions, if they are capable of delivering the services that the people of Ghana need and are indeed able to do so efficiently, so be it.

ECG is indeed a gold mine, rich in ore, yet, left at the mercy of illegal miners by Rip Van Winkle (Ghana) the slumbering owner. Isn�t it a sad state of affairs? Will Ghana ever work for the benefit of all?

Source: David Klutse (UK) e-mail [email protected]