The Electricity Company of Ghana (ECG), Ghana’s primary electricity distributor, has emerged as the most severely indicted public institution in the 2024 Auditor-General’s Report on the Public Accounts of Ghana: Public Boards, Corporations and Other Statutory Institutions.
The damning report paints a picture of gross financial mismanagement, disregard for procurement laws, and troubling inefficiencies that have resulted in massive financial losses and liabilities to the state.
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With unresolved debts, inflated procurement costs, underreported revenues, and unaccounted assets, the ECG’s operational lapses amount to over GH¢17 billion in fiscal concerns, a crisis the report warns could destabilise Ghana’s power sector if not urgently addressed.
ECG owes Bui Power over $729m
One of the most staggering revelations in the report is ECG’s debt of $729.7 million ($729,776,253) to Bui Power Authority, a strategic energy generation company.
This singular obligation represents a significant share of ECG’s debt to Independent Power Producers (IPPs), threatening the financial viability of Ghana’s energy generation industry.
GH¢4.2bn not paid under Cash Waterfall Mechanism
Under the Cash Waterfall Mechanism (CWM) — a framework established to ensure equitable distribution of revenues among sector stakeholders — ECG failed to remit GH¢4.2 billion (GH¢4,245,586,079.19) to various State-Owned Enterprises (SOEs) and Independent Power Producers (IPPs).
This non-payment undermines the integrity of the mechanism and poses a threat to sustainable electricity generation and transmission.
GH¢2.9bn revenue underreporting
According to the report, ECG collected GH¢11.5 billion (GH¢11,591,174,225.48) in revenue for the 2023 financial year.
However, the company declared only GH¢8.6 billion (GH¢8,637,759,625.94) to the Minister for Energy and other authorities — underreporting actual collections by a staggering GH¢2.9 billion (GH¢2,953,414,599.54).
GH¢1.2bn not disbursed
Of the declared amount, GH¢7.3 billion (GH¢7,345,588,146.29) was disbursed to sector beneficiaries, leaving GH¢1.2 billion (GH¢1,292,171,479.65) undistributed.
The Auditor-General recommended that ECG’s Managing Director at the time be held accountable for this GH¢1.2 billion, and that the CEO and Finance Director be made to explain the GH¢2.9 billion shortfall.
$17m Procurement loss from avoidable middlemen
ECG’s procurement practices came under further scrutiny when the audit uncovered that the company paid $30.7 million ($30,730,260) for equipment that could have cost only $13.6 million ($13,637,983) if purchased directly from original manufacturers.
By engaging local suppliers rather than buying directly, ECG incurred an avoidable loss of $17,092,277, equivalent to GH¢251.2 million (GH¢251,256,471.90).
ECG as consignee on bills of lading
Worse still, the bills of lading from the manufacturers listed ECG as the consignee, making the utility company solely responsible for duties and demurrage — despite the markup from the intermediaries.
The Auditor-General has recommended direct procurement from original manufacturers and sanctions against officers responsible for the loss under Section 92 of the Public Procurement Act, 2003 (Act 663), as amended.
GH¢75m paid to Hubtel without a contract
ECG also found itself in hot water for paying GH¢75 million in 2022 to Hubtel Limited, a digital payment services provider, without any signed contract agreement.
This payment was for revenue collection services, yet ECG failed to present any documentation justifying the transaction.
5 year retroactive contract
The audit later confirmed that a five-year agreement with Hubtel was signed only on March 20, 2024, retroactively effective from January 1, 2023.
Under the agreement, Hubtel was entitled to a 0.9% commission on every processed transaction.
GH¢148.9m deducted by Hubtel
According to the Auditor-General, Hubtel collected GH¢10.3 billion (GH¢10,344,056,338.64) on ECG’s behalf in 2023 and deducted GH¢148.9 million (GH¢148,908,900.29) in commissions before depositing the balance of GH¢10.1 billion (GH¢10,195,147,438.35) into ECG’s accounts.
GH¢101.1m Hubtel debt disallowed
Furthermore, the contract claims ECG owed Hubtel GH¢101.1 million (GH¢101,105,243.98) in service fees for transactions between November 1, 2022, and December 31, 2023, before the formal agreement was signed.
ECG management admitted to this “legacy debt,” attributing it to delays in agreeing on service fees post-pilot phase.
However, the Auditor-General questioned the legitimacy of the claim due to lack of transaction-level documentation, recommending that the GH¢101 million claim be disallowed.
GH¢4.5m in unaccounted items
Across five ECG regional offices — including Tema Depot, Accra East, Accra West, Ashanti East, and Ashanti West — procurement of goods worth GH¢4.5 million (GH¢4,544,502.85) were not supported with Store Receipt Advices (SRAs).
These items, including vehicles and Samsung tablets, were also not recorded in store ledgers.
The Auditor-General has demanded that ECG provide supporting documentation or hold authorising officers personally liable.
GH¢189m budget overruns on 13 items
A review of ECG’s 2023 expenditure revealed that 13 budget items were overspent by GH¢189 million (GH¢189,210,656.40), exceeding the budgeted GH¢144.7 million (GH¢144,749,949) with actual spending of GH¢333.9 million (GH¢333,960,605.42).
The overspending — attributed to price hikes and inflation rates above 23% — lacked prior approval from ECG’s board.
The Auditor-General warned that this undermines transparency and may compromise the execution of other essential programs.
GH¢70.9m withholding tax not remitted
In 2023, ECG withheld GH¢70.9 million (GH¢70,920,367.66) in taxes from payments to suppliers and service providers but failed to remit the funds to the Ghana Revenue Authority (GRA).
As of December 2023, ECG acknowledged owing GH¢55,525,889.60, and had made three instalment payments totaling GH¢14,443,414.94 by the end of 2024, leaving an outstanding balance of GH¢56,476,952.72. Management stated that reconciliation with the GRA is ongoing.
Over GH¢5m worth of unused meters abandoned
An inspection at Tema Depot (Aluworks Warehouse) found 6,096 unused prepaid meters valued at GH¢5.1 million (GH¢5,144,246.09) sitting idle for years.
The devices, categorized as non-smart three-phase meters, are incompatible with ECG’s current smart meter systems.
Though ECG claims they are reserved for replacing faulty non-smart meters, the slow rate of deployment raises concerns about resource wastage and poor inventory management.
GH¢2.4m office renovation project stalled
In 2017, ECG awarded a contract worth GH¢1.4m (GH¢1,453,555.56) to Premium Innovative Limited for the renovation of its Tema Regional Office, scheduled for completion by May 2018.
The project stalled after partial execution
By the time of the audit, ECG had paid GH¢1,114,749.58 out of a revised contract sum of GH¢2,421,207.89, with only 75% of the work completed.
ECG reclaimed the project in November 2024 and intends to re-award the contract for completion.
GH¢2m in uncompetitive procurement
ECG’s Ashanti West/SBU, Ashanti South, and Ashanti East regional offices were cited for making uncompetitive purchases totaling GH¢2 million (GH¢2,069,304.66), without obtaining three alternative quotations or seeking approval for single-source procurement.
This violates the Public Procurement Act and exposes ECG to cost inefficiencies and potential procurement fraud.
Conclusion: A call for urgent reform
The 2024 Auditor-General’s report on ECG is a sobering account of fiscal recklessness, weak oversight, and systemic inefficiencies within Ghana’s leading power distribution company.
The Auditor-General has called for the application of sanctions under relevant financial laws, including Act 663 and Act 921, against officers whose actions caused financial losses to the state.
ECG paid $30.7m on items worth $13.6m-Auditor-General
The Electricity Company of Ghana (ECG) has been indicted by the Auditor-General for spending a staggering $30.7 million ($30,730,260) on equipment that could have cost $13.6 million ($13,637,983) if purchased directly from the original manufacturers.
This procurement decision led to an avoidable loss of over $17 million ($17,092,277) to the state-owned utility provider.
This revelation is contained in the 2024 Auditor-General’s Report on the Public Accounts of Ghana: Public Boards, Corporations and Other Statutory Institutions for the Period Ended 31 December 2024.
Procurement through local suppliers inflates costs
The audit report states clearly that ECG awarded contracts to local suppliers instead of procuring directly from the manufacturers.
Despite the inflated payments, bills of lading from the original manufacturers listed ECG as the consignee, meaning ECG was the entity responsible for clearing the goods at the ports and paying duties and demurrage charges — a responsibility it would have borne even if it had purchased the goods directly at the lower cost.
This arrangement, the Auditor-General stressed, offered no added value from the intermediaries, yet led to a cost escalation of over 125%.
Deal directly and sanction offenders
The Auditor-General has strongly recommended that ECG management desist from splitting procurement orders among local suppliers and instead engage directly with manufacturers — both local and foreign — to safeguard public funds.
Furthermore, the report calls for the sanctioning of ECG officials whose actions or inactions resulted in this infraction, in accordance with Section 92 of the Public Procurement Act, 2003 (Act 663), as amended.
This provision empowers authorities to punish public officials who engage in procurement malpractices that cause financial loss to the state.
In response to the audit, ECG Management acknowledged the issue and indicated they would consider the recommendation to procure directly from foreign manufacturers going forward.
Legal backing for accountability
The report also cited Section 52 of the Public Financial Management Act, 2016 (Act 921), which mandates principal spending officers of state-owned enterprises to protect and manage the assets of their institutions.
The law requires them to establish preventive mechanisms to eliminate theft, loss, wastage, and misuse of assets.
By allowing inflated procurements and inefficient procurement methods, the Auditor-General suggests that ECG management may have violated these statutory obligations, further deepening concerns about financial stewardship and procurement discipline within the utility company.
Broader sector concerns
This latest infraction adds to growing public concern about procurement malpractices and wasteful spending in Ghana’s energy sector.
ECG, already under scrutiny for underreported revenues and irregular disbursements under the Cash Waterfall Mechanism, now faces renewed calls for transparency, accountability, and procurement reform.
