Finance Minister Dr. Cassiel Ato Forson has disclosed that the energy sector inherited by the John Mahama administration was in critical condition, plagued by annual financial deficits exceeding $1.5 billion.
Presenting the 2025 Mid-Year Budget Statement to Parliament on Thursday, July 24, Dr. Forson characterized the sector as “bleeding” at the time his government took office, attributing the state of affairs to years of poor management, lingering debts, and flawed power agreements.
“We inherited a bleeding energy sector with annual financing shortfalls in excess of $1.5 billion,” he emphasized, warning that the situation jeopardized both the country’s fiscal health and its energy future.
He explained that the deficits were driven by a mix of unsustainable Power Purchase Agreements (PPAs), weak revenue collection, high operational expenses, and longstanding unpaid debts within the sector.
“These challenges not only strained our national finances but also undermined efforts to stabilize the economy and ensure reliable energy supply,” Dr. Forson noted.
To address the crisis, he said the government has initiated strategic reforms including the renegotiation of PPAs to curb excess capacity payments, a revamp of sector governance, and measures to improve transparency and accountability across the energy chain.
“Our goal is to transform the energy sector from a fiscal drain into a foundation for national development,” Dr. Forson stated, underscoring the administration’s dedication to sustainable recovery.
He added that although progress has been made, success will depend on continued cooperation from stakeholders and strict adherence to policy discipline to fully restore and grow the sector.
