Citi News Explainer | Mahama’s electricity exemption – who benefits, how and why

The Office of the President and four key ministries have received electricity exemptions. These ministries are Health, Education, Defence, and the Interior. They will no longer pay monthly electricity bills in selected areas. This support aims to ensure uninterrupted power supply to essential institutions. The Cabinet approved this directive.

The government will cover the costs through existing budget allocations. These funds come from the Finance Ministry’s “goods and services” budget lines. The Electricity Company of Ghana (ECG) and Northern Electricity Distribution Company (NEDCO) must implement these measures at designated sites.

The exemptions apply to specific areas only. Core presidential offices and installations are included. Public schools can exempt lecture halls, learning areas, medical labs, and computer labs approved by relevant ministries. The Ministry of Health's facilities include operating theatres, wards, pharmacies, and vaccine storage sites.

Military intelligence hubs and secured communication centers under Defence are also exempted. Emergency monitoring centres within police and national security services qualify too.

However, some facilities are excluded from these exemptions. Non-essential areas like dormitories, dining halls, hostels, and recreational centres do not qualify. Other non-emergency installations remain responsible for their power costs.

This situation raises concerns about fiscal pressures on the public budget. ECG and NEDCO already face cash flow issues. Diverting billing could worsen revenue shortfalls in the energy sector.

To mitigate potential revenue loss, the government has a plan. It has instructed ECG and NEDCO to enhance collection efforts from non-exempt customers. This includes an aggressive disconnection campaign when necessary.