Finance Minister Dr. Cassiel Ato Forson has revealed that the Mahama administration inherited an energy sector in deep financial distress, with annual funding gaps surpassing $1.5 billion.
Delivering the 2025 Mid-Year Budget Review in Parliament on Thursday, July 24, Dr. Forson described the state of the energy sector at the time of President Mahama’s return to office as alarming, stating plainly: “We inherited a bleeding energy sector with annual financing shortfalls in excess of $1.5 billion.”
He explained that the massive shortfalls were the result of compounding problems — including legacy debts, poorly negotiated Power Purchase Agreements (PPAs), inefficient revenue collection, and high operational costs — all of which, he said, were neglected by the previous Akufo-Addo administration.
“These challenges didn’t just burden the budget. They placed the entire economy at risk and threatened Ghana’s energy security,” he added.
Dr. Forson said the energy sector’s growing debt, which has been flagged as a major threat since 2023, required urgent structural reforms to prevent a full-blown financial collapse.
In response, the Mahama government has launched a set of aggressive reforms to halt the bleeding. These include the renegotiation of PPAs to eliminate over-priced excess capacity charges, efforts to restructure sector governance, and enhanced transparency across the energy value chain.
He assured lawmakers that these reforms are part of a broader agenda to reposition the sector as a stable, efficient, and growth-enabling component of the national economy.
“The Mahama administration is fully committed to turning the energy sector into a sustainable pillar of development,” Dr. Forson said, pledging that the mistakes of the past will not be repeated.
