Reduction in water tariffs will affect operations — GWCL
The Ghana Water Company Limited (GWCL) says a reduction in water tariffs as requested by organised labour will affect the operations of the company and urban water supply.
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According to the company’s Chief Manager in charge of Corporate Planning, Mr Cephas Oguah, the cost of production currently was very high and did not reflect the current tariffs approved by the Public Utilities Regulatory Commission (PURC).
However, he said, they were working around the approved tariffs to achieve the company’s aim of improving water supply and water quality.
Prior to the upward adjustment in utility tariffs in December, 2015, 1000 litres of water (220 gallons) was GH¢1.78 while the new approved tariffs for the same quantity of water now goes for GH¢2.98.
Mr Ogua was speaking at a press conference in Accra on Monday to address some of the concerns raised by members of the public and organised labour.
“GWCL water is still very cheap regardless of the recent increment and, therefore, a downward review will mean compromising on water quality, quality service delivery and water supply.
“Even though the tariff approved in 2013 was inadequate, GWCL has been able to sustain its operations to date, in the face of other challenges. We have been able to operate all the 86 water systems satisfactorily to date, and therefore, the company thinks the current review was not out of place,” he stated.
Why the increment?
In an interview with the Daily Graphic after the press conference, the Communications Manager of the GWCL, Mr Stanley Martey, said the increment became necessary because GWCL — the country’s sole utility provider mandated to supply potable water for domestic, institutional, and commercial purposes in the urban and peri-urban communities in Ghana — had over the years been faced with some challenges in the light of inadequate water supply to its customers, leading to rationing of water in some instances.
That, he attributed to the high cost of production by way of using more chemicals and undertaking frequent repairs of pumping equipment as a result of the pollution of raw water sources and siltation at the intakes mainly through human activities such as tree felling, farming, illegal mining, sand winning and fish farming.
“With a current population of about 25 million, our coverage is about 77 per cent. Our inability to serve our customers with a 24-hour supply at all times has dented our image, and the perception of the public is that the service of the company is poor,” he said.
Mr Martey said the present hitch in service delivery was due to the inability of the company to raise enough revenue to finance the much needed capital investment projects.
“Like any utility, GWCL is expected to provide services that are safe, desirable, and affordable to consumers and ensure an institutional and commercial system capable of actually recovering costs. Like any business, GWCL must recover its costs if we are to sustain our operations. Over the years, however, the approved tariffs have not been cost reflective,” he added.
Background
In December, 2015, the PURC announced steep increases in utility tariffs of 59.2 per cent for electricity and 67.2 per cent for water.
The increments, according to officials of the PURC, were to enable the utility providers to have a clean balance sheet to borrow from the financial market without recourse to the government to finance their operations.