Tuesday, 23 June

Energy Sector Levy generates ¢8.81bn in 2025, but total expenses hit ¢22.67bn

Business
Dr Cassiel Ato Baah Forson, Finance Minister

The government has revealed that the Energy Sector Shortfall and Debt Repayment Levy generated GH¢8.81 billion during the 2025 fiscal year. The revenue was funneled directly into the Energy Sector Support Account to manage industry liabilities.

The data was officially presented to Parliament on Tuesday, June 23, 2026, by the Finance Minister, Dr Cassiel Ato Forson, in the annual report on the energy levy.

The levy, which imposes a charge of GH¢1 per litre on selected petroleum products, was originally introduced to raise critical funds for fuel purchases for thermal power plants and to clear outstanding legacy debts within the energy sector.

Total Funds Available and Utilisation

According to the report, the GH¢8.81 billion generated from collections was supplemented by a balance of GH¢1.26 billion brought forward from previous accounts. This brought the total available funding within the Energy Sector Support Account for 2025 to GH¢10.07 billion.

Out of this accumulated amount, the government successfully utilised GH¢9.82 billion. The expenditure breakdown includes:

- GH¢6.32 billion to settle critical energy sector financial shortfalls.

- GH¢3.52 billion allocated toward the systemic repayment of legacy debts under the provisions of Act 1135.

Following these disbursements, the remaining balance in the Energy Sector Support Account stood at GH¢252.23 million as of December 31, 2025.

Significant Shortfalls Funded by the Treasury

Despite the substantial revenue generated by the GH¢1-per-litre petroleum levy, the proceeds proved insufficient to meet the energy sector's total financial obligations for 2025.

To bridge the substantial funding gap, the Controller and Accountant General's Department had to step in, drawing an additional GH¢12.85 billion directly from the Treasury Main Account.

In total, when combining resources from both the dedicated Energy Sector Support Account and the Treasury Main Account, the government expended a massive GH¢22.67 billion in 2025 to keep the power sector afloat and manage long-standing institutional debt.

Calls for Transparency and Government Defense

The management and allocation of the energy levy have routinely faced intense scrutiny from civil society groups and energy stakeholders, who have demanded greater transparency regarding how the petroleum taxes are distributed.

In the report presented to the House, the government robustly defended its management of the funds. The Finance Ministry emphasised that despite the severe deficits, the consistent deployment of the levy proceeds has been a core pillar in supporting national efforts to stabilize the grid and ensure a more reliable power supply across the country.

Source: classfmonline.com