Elikplim Apetorgbor writes: Impact of Emissions Levy on electricity generation tariffs in Ghana
1. The implementation of the new tax laws and amendments directs the enactment of the Emissions Levy Act, 2023 (Act 1112). This law imposes a levy of GHS100 per tonne on carbon dioxide equivalent emissions from the electricity producers, as statutory incidence;
2. In accordance with the Power Purchase Agreements (PPAs), this legislation is a political risk (an Increased Cost Event) mitigated by an Increased Costs clause in the Agreements, which suggests a pass-through mechanism, where the economic incidence goes to the end user;
3. As a direct consequence of this statutory incidence on the power producers, there will be an upward adjustment in the cost build-up of the electricity generation. Power plant management and operation is cost sensitive just as the downstream petroleum sectors. Specifically, the levy will be added to the operational costs build-up of the power plants;
4. Impact on Electricity Users – The implementation of the Emissions Levy Act, 2023 necessitates an equal measure of review of the electricity generation tariff, to ensure the predictability of the cash flow obligations of the power producers; and.
5. This adjustment is essential to cover the increased operational costs induced by the imposition of the Emissions Levy, Act 2023 (Act 1112) to ensure an operational reliability and sustainability.
Trending News
My brothers and sisters are Christians, I cannot say that I’ll not get close to them – Bawumia as he fosters interfaith harmony
07:25C/R: Training of gov’t public relations officers on tackling information disorders underway
20:12NPP parliamentary candidates given slots to recruit into security agencies – Minority
17:45Fixing depreciating Cedi must be urgent to you than securing new loans – Ato Forson to gov’t
07:52Ghanaian man told he is not British after 42 years in UK
13:32Ambulance case: There's no financial loss to the state - 3rd accused
16:30Akufo-Addo invites Minority, Majority to discuss issues of national concern
15:44Zoomlion Sends 18 youths on landmark sanitation mission to Belarus & Russia
02:59NHIA CEO introduces free medical screening for Ghanaians on their birthdays
13:10Ambulance case: Govt failed to cooperate with Big Sea to install supplied accessories on ambulances - 3rd accused
16:25