Mining companies to pay higher tariffs

Mining companies in the country would from the beginning of next month (July 1st, 2008) pay higher tariffs on energy (electricity) consumed for their operations.
Steel mills and other high voltage consumers of electricity would also be affected.
This move by the government falls in line with its measures to help resource the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG).
The mining companies, together with other high voltage consumers would pay a ‘Bulk Generation Tariff’ of Gp16.91 per kilowatt an hour. This translates into an ‘End User Tariff’ of Gp 22.31 per kilowatt per hour.
Other category of consumers would remain at their current tariff levels, according to the Minister of State at the Ministry of Finance and Economic Planning (MOFEP), Anthony Akoto Osei. He said this at press briefing in Accra on the state of the economy. “The tariffs will help improve VRAs finances,” he said.
He, however, urged consumers who were not affected by the tariff increment to conserve energy appropriately.
The use of hydro component for generation would also be increased in addition to increase in tariffs for the high voltage users, while the emergency power plants would be shut down.
Hon. Akoto Osei averred that some free flow of gas from the West Africa Gas Pipeline has already started and supply is expected to be accelerated soon.
These measures taken by government stemmed from the fact that the nations crude oil import bill has risen from US$5OOmillion in 2005 to US$2.1billion as at the end of 2007. A report from the MOFEP indicates that the trend has not reduced but has kept on moving to US$2.5billion for the same quantity of oil.
“This is the result of the escalating crude oil prices at the world market, a phenomenon which threatens to throw the budget out of gear, reducing the country’s foreign exchange reserves and inflaming inflationary pressures. A combination of measures is being pursued to ensure that these developments are mitigated,” noted the Minister.
According to Akoto Osei, the measures taken by the government is expected to cushion the economy, thereby providing a reprieve to consumers in the country.
“These measures are expected to result in a significant reduction in crude oil imports and would lead to enough savings to help the fiscal position and conserve foreign exchange”, noted Akoto Osei.