ICU demands formula for automatic adjustments of tariff

The Industrial and Commercial Workers Union (ICU) has called on the Public Utilities Regulatory Commission (PURC) to make the Automatic Tariff Adjustment Formula (AAF) known to the public.

Mr. Solomon Kotei, ICU General Secretary, said when this is done it will enable the public to better appreciate and accept the formula.

He said the AAF’s main objective is to quarterly review electricity and water tariffs to reflect changes in factors which effect their operation.

Mr Kotei, speaking in an interview with Ghana News Agency on the proposed increment of utility tariffs, said in 2014 the automatic tariff adjustment formula was introduced.

“PURC started implementing the AAF as a pricing mechanism based on the factors that reflect the actual cost of electricity and water supply,” he said.

He said an open understanding of the automatic adjustment formula operations – its review either upward or downward – would enable the Union to speak clearly on the issue and identify challenges with the formula should the need arise.

Mr. Kotei said there have been periods when increases were left for a long time before they were triggered, and this leads to 70 to 80 percent increments – which has always resulted in labour agitation.

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He said ICU is at a point where they need to know the formula, which would enable them in understanding the process for the increment and reasons as to why it should be high or low.

Mr. Kotei said at a point government intervened and demanded from the PURC a sharp reduction of 30 percent to about 15 percent.

The PURC, in accordance with the Public Utilities Regulatory Commission Act, 1997 (Act 538), has initiated processes for the examination and approval of electricity and water tariffs for 2019 to 2023.

During the review process, the Commission will examine proposals submitted by the utility companies.

Mr. Ishmael Agyakumhene, the PURC Technical Committee Chairman, said the Commission will meet to deliberate and consider service providers on the increase in tariffs.

The Commission has rolled out stakeholder engagement mechanisms to consult utility service providers on the commencement date for the tariff review.

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