Felix Kwakye Ofosu, Presidential Spokesperson and Minister of State responsible for Government Communications, has lauded the impact of the GH¢1 fuel levy popularly called Dumsor levy in reducing the energy sector’s longstanding debts.
The GH¢1.00-per-litre fuel charge—popularly known as the “D-Levy” and introduced under the Energy Sector Levies (Amendment) Act, 2025 (Act 1141)—took effect on July 16, 2025.
It was designed to raise dedicated revenue for the energy sector, particularly to clear accumulated liabilities and close funding gaps.
Addressing the first edition of the 2026 Government Accountability Series Press Conference at the Presidency in Accra, Ofosu explained that the Fuel Levy was instituted to resolve a recurring financial shortfall created by the high cost of liquid fuels purchased to operate thermal plants—costs that were not fully reflected in electricity tariffs.
He noted: “The estimates show that on a yearly basis, about $1.2 billion or so is required for the purpose of importing liquid fuels to fire thermal plants. Now, if some effort is not made to bridge this gap, it will pose a challenge, though some efforts are being made to address the many problems that plague the sector which we inherited.”
Ofosu added that the Ministry of Finance would continue to update Parliament annually on petroleum receipts and overall budget accounting, including the total revenue generated from the GH¢1.00 levy.
According to him, “What is clear is that it has been put to good use and has contributed significantly to achieving stability in the power sector. When we took over power, there were challenges with electricity stability, and I think all of us can attest that the electricity supply has been stable for several months now. We’ve not experienced the outages that many have feared would be the case.”
He further highlighted progress made in settling the country’s energy-sector debt, referencing a recent statement from the Finance Ministry that approximately $1.4 billion owed within the sector had been paid off.
Ofosu clarified that the statement did not imply that only $1.4 billion of debt had been cleared, but rather that a substantial portion had been settled within a year—providing relief to industry players.
He explained that past inconsistencies in applying the cash waterfall mechanism had hindered liquidity flows, particularly to Independent Power Producers (IPPs).
“What had happened was that there was some lack of discipline in terms of adherence to the cash waterfall mechanism… For a long time, there were some players in the sector, especially IPPs, who were not getting commensurate amounts,” he said.
He added that the Finance and Energy Ministries had now enforced compliance, ensuring consistent payments across the value chain and helping to stabilise the power system.
He emphasised that the government remained committed to fully clearing the sector’s debts and would continue increasing payments while creating conditions for broader financial reforms in the energy industry.
