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The Electricity Company of Ghana (ECG), the country’s main power distributor, has been severely indicted in the 2024 Auditor-General’s Report on Public Boards, Corporations, and Other Statutory Institutions, emerging as the single most financially mismanaged state-owned enterprise.
The damning report, which audits the financials up to 31 December 2024, highlights gross violations in procurement, revenue underreporting, asset mismanagement, and non-compliance with key public financial laws — culminating in fiscal concerns exceeding GH¢17 billion. The report warns that if these issues remain unaddressed, they could destabilise Ghana’s already fragile power sector.
At the core of ECG’s financial distress is its massive debt of $729.7 million to Bui Power Authority — a strategic power generator — and billions owed to other Independent Power Producers (IPPs). The report revealed that ECG failed to remit GH¢4.2 billion due to sector stakeholders under the Cash Waterfall Mechanism (CWM), which is designed to equitably distribute revenue in the energy value chain.
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Even more concerning, ECG collected GH¢11.5 billion in revenue in 2023 but declared only GH¢8.6 billion to the Minister for Energy — a discrepancy of GH¢2.9 billion. Of the declared amount, GH¢1.2 billion remains unaccounted for. The Auditor-General has recommended that ECG’s Managing Director at the time be held accountable for the undistributed funds and that the CEO and Finance Director explain the underreporting.
In a stunning example of procurement abuse, ECG spent $30.7 million on equipment that could have cost just $13.6 million if purchased directly from original manufacturers. The avoidable loss of over $17 million (GH¢251.2 million) was attributed to ECG’s decision to use local suppliers as intermediaries. Shockingly, ECG was still listed as the consignee in the bills of lading, making it liable for duties and demurrage — costs that would have existed regardless of middlemen.
The Auditor-General has recommended the immediate cessation of indirect procurement and called for sanctions against responsible officials under Section 92 of the Public Procurement Act, 2003 (Act 663), as amended.
The report also exposes ECG’s payment of GH¢75 million in 2022 to Hubtel Limited, a digital payment company, without any formal contract. Although a retroactive five-year agreement was signed in March 2024, ECG could not justify the initial payment. The contract stated that ECG owed Hubtel GH¢101.1 million in fees for services rendered between November 2022 and December 2023, but the Auditor-General questioned the validity of the claim due to a lack of transaction-level data and recommended the amount be disallowed.
Across ECG’s Tema Depot, Accra East, Accra West, and Ashanti operational areas, goods worth GH¢4.5 million — including Samsung tablets and vehicles — were procured without Store Receipt Advices and excluded from inventory ledgers. The Auditor-General demanded that ECG either account for the missing records or hold authorising officers liable.
In Tema, 6,096 unused prepaid meters valued at GH¢5.1 million were found idle in storage. ECG claims these meters are reserved for replacing faulty non-smart units, but the auditor general raised concerns about inventory wastage and misaligned procurement planning.
ECG overspent 13 budget lines by GH¢189 million, exceeding the approved budget of GH¢144.7 million without board approval. The report attributes the overspending to inflation exceeding 23% but flags the lack of oversight as a governance failure.
Furthermore, ECG withheld GH¢70.9 million in taxes from suppliers in 2023 but failed to remit the amount to the Ghana Revenue Authority (GRA). As of end-2024, only GH¢14.4 million had been paid, leaving an outstanding balance of over GH¢56 million.
A contract for the renovation of ECG’s Tema Regional Office, worth GH¢1.4 million and awarded in 2017, remains unfinished. Although GH¢1.1 million has been disbursed, only 75% of the work has been completed. ECG reclaimed the project in November 2024 with plans to re-award it.
In the Ashanti Region, ECG also made uncompetitive procurements totalling GH¢2 million without obtaining three quotations or approvals for sole sourcing — again breaching the Public Procurement Act.
The Auditor-General concluded that ECG’s actions likely violate multiple provisions of Ghana’s financial laws, including:
- Public Procurement Act, 2003 (Act 663)
- Public Financial Management Act, 2016 (Act 921)
The report invokes Section 52 of Act 921, which mandates principal spending officers to protect state assets and prevent waste, and Section 92 of Act 663, which prescribes sanctions for public officers responsible for procurement infractions.
The Auditor-General has called for disciplinary action, prosecution where necessary, and a full-scale reform of ECG’s procurement, financial, and operational systems.
ECG’s fiscal recklessness, coupled with its central role in Ghana’s energy distribution chain, poses a serious risk to the viability of the power sector. Already under pressure from fuel supply challenges, tariff disputes, and regulatory gaps, the sector cannot afford the continued mismanagement of its largest distributor.
With over GH¢17 billion in flagged infractions, the 2024 audit of ECG is not just a financial red flag — it is a governance emergency.
As public outrage mounts and calls for accountability grow louder, stakeholders are demanding a full parliamentary probe, forensic audits, and the prosecution of officials found culpable.
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