Mahama says Ghana has ended dumsor after clearing US$1.7bn IPP debt

President John Dramani Mahama has declared that Ghana is no longer experiencing power outages, popularly known as dumsor, following what he describes as a major improvement in the management of the country's energy sector.

He says his government has cleared outstanding debts owed to Independent Power Producers (IPPs) and introduced a payment arrangement intended to ensure electricity suppliers receive money promptly for power delivered to the national grid.

Speaking to Ghanaians in Moscow, Russia, President Mahama said the administration inherited approximately US$1.7 billion in unpaid obligations to IPPs, alongside arrears for natural gas supplied from the Jubilee Field and by ENI.

He said the financial difficulties had placed considerable pressure on electricity generation, with some power producers threatening to suspend supply because of unpaid bills.

"With regard to energy, I can report that there's no dumsor in Ghana. Everybody has adequate power. And that's one of the areas that has been quite dramatic in terms of its management," he said.

Government says IPP debts have been cleared

President Mahama said the government had now settled its outstanding IPP debt and was up to date with payments for electricity supplied.

"I'm happy to announce that we have cleared the IPP debt. That is, we are current. Any energy they supply today, we're paying them," he said.

The President said the government had also introduced a separate payment arrangement to address remaining obligations, involving initial payments followed by further settlements as they fall due.

According to him, the arrangement has helped rebuild confidence between the government and power producers while reducing the risk of interruptions to electricity supply.

The government's approach is aimed at addressing one of the longstanding financial challenges in Ghana's energy sector: the accumulation of unpaid bills to companies responsible for generating electricity.

Financial challenges in the energy sector

Ghana's electricity supply has faced pressure from financial difficulties involving power producers, fuel suppliers and other players in the energy value chain.

The outstanding obligations inherited by the Mahama administration, according to the President, included debts to IPPs and arrears relating to gas supplies.

Such payment difficulties can threaten the ability of power producers to maintain operations and secure the fuel needed to generate electricity.

The sustainability of the improvement will depend partly on whether the government can maintain regular payments to electricity producers and fuel suppliers while preventing new arrears from accumulating.

For households and businesses, the central question will be whether the improved financial arrangements translate into consistent electricity supply without a return to the prolonged outages that have affected the country in previous years.