ECG’s losses hit GH₵22.1bn in 5 years, as system losses rise to 30.31%

The total losses incurred by the Electricity Company of Ghana (ECG) between 2017 and 2021 amounted to GH₵22.1 billion (GH₵22,116,378,577.97).

Breakdown
It is made up of technical losses -GH₵2.8 billion (GH₵2,879,100,614), commercial losses – GH₵6.1 billion (GH₵6,116,538,674.98), system losses – GH₵8.9 billion (GH₵8,995,639,288.99) and collection losses – GH₵4.1 billion (GH₵4,125,100,000).

This is the amount government spent to keep the lights on without getting it back.

What is striking is that ECG has not met any of the World Bank’s benchmarks for acceptable losses, demonstrating that the ECG is highly inefficient.

The Minister of Energy, Dr Matthew Opoku Prempeh, made the figures public at the Minister’s Press Briefing in Accra in a presentation dubbed “Keeping the lights on, keeping the nation moving.”

GH₵2.7bn total losses in 2017
In 2017 alone, the four losses combined amounted to GH₵2.7 billion (GH₵2,727,045,139.98).

Breakdown
The breakdown comprises GH₵438.4 million (GH₵438,449,669.30) technical losses, GH₵873.4m (GH₵873,492,900.69), commercial losses, GH₵1.3 billion (GH₵1,311,942,569.99) system losses and GH₵103.1 million (GH₵103,160,000) collection losses.

GH₵3.9bn total losses in 2018
Regarding the performance in 2018, ECG recorded GH₵3.9 billion (GH₵3,915,653,248.02) losses.

Breakdown
It is made up of GH₵529.1 million (GH₵529,102,673.92) technical losses, GH₵969.2 million (GH₵969,258,950.09) commercial losses, GH₵1.4 billion (GH₵1,498,361,624.01) system losses, as well as GH₵918.9 million (GH₵918,930,000.00) collection losses.

GH₵3.4bn total losses in 2019
For 2019, ECG posted GH₵3.4 billion (GH₵3,492,348,570.66) total losses.

Breakdown
The breakdown is GH₵617.6 million (GH₵617,634,726.80) technical losses, GH₵1 billion (GH₵1,088,544,558.53) commercial losses, GH₵1.7 billion (GH₵1,706,179,285.33) system losses and GH₵79.9 million (GH₵79,990,000) collection losses.

GH₵5.5bn total losses in 2020
In respect of 2020, accumulated losses rose to GH₵5.5 billion (GH₵5,567,232,678.38).

Breakdown
It comprises technical losses – GH₵640.9 million (GH₵640,908,278.58), commercial losses – GH₵1.4 billion, (GH₵1,400,138,060.61), system losses GH₵2 billion (GH₵2,041,046,339.19), as well as collection losses – GH₵1.4 billion (GH₵1,485,140,000).

GH₵6.4 total losses in 2021
The losses rose further to GH₵6.4 billion (GH₵6,414,098,940.93) in 2021.

Breakdown
It is made up of GH₵653 million (GH₵653,005,265.40) technical losses, GH₵1.7 billion (GH₵1,785,104,205.06) commercial losses, GH₵2.4 billion (GH₵2,438,109,470.47) system losses and GH₵1.5 billion (GH₵1,537,880,000) collection losses.

GH₵2.8 technical losses in 5 years
The data shows that ECG’s technical losses for five years amounted to GH₵2.8 billion (GH₵2,879,100,614).

Breakdown of technical losses
The annual breakdown of technical losses during the period includes 2017- GH₵438.4 million (GH₵438,449,669.30), 2018 – GH₵529.1 million (GH₵529,102,673.92), 2019 – GH₵617.6 million, (GH₵617,634,726.80), 2020 – GH₵640.9 million (GH₵640,908,278.58) and 2021- GH₵653 million (GH₵653,005,265.40).

Percentages for annual technical losses
In percentage terms, technical losses for each are 2017 (10.55%), 2018 (10.55%), 2019 (10.55%), 2020 (9.84%), and 2021 (9.84%)

7.44% technical losses according to World Bank’s benchmark
The World Bank’s benchmark for technical losses is 7.44% based on load factor or constraints within the system.

0.71%  improvement on technical losses in 2020 and 2021
Per the data, ECG recorded 0.71% improvement on technical losses in 2020 and 2021.

ECG remains inefficient
Despite that, ECG remains inefficient in managing technical losses, as it never met the World Bank’s benchmark in any of the years.

Technical losses explained
Technical losses are the losses that occur within the distribution network due to the cables, overhead lines, transformers and other substation equipment that are used to transfer electricity.

It comprises fixed losses which are constant and can only be reduced by replacing older assets with modern high efficiency equipment and variable losses which change as the amount of power flowing changes; in a highly loaded network, they are much greater than fixed losses.

GH₵6.1bn commercial losses in 5 years
Commercial losses between 2017 and 2021 totalled a whopping GH₵6.1 billion (GH₵6,116,538,674.98).

Annual breakdown of commercial losses
The annual breakdown comprises 2017 – GH₵873.4 million (GH₵873,492,900.69),
2018 – GH₵969.2 million (GH₵969,258,950.09), 2019 -GH₵1 billion (GH₵1,088,544,558.53)
2020 – GH₵1.4 billion (GH₵1,400,138,060.61) and GH₵1.7 billion (GH₵1,785,104,205.06)

Percentages for annual commercial losses
Regarding yearly percentages of commercial losses, the figures are 2017 (13.70%), 2018 (13.75%), 2019 (14.13%), 2020 (16.36%) and 2021 (20.47%).

Commercial losses explained
Commercial losses refer to the illegal consumption of energy. Meter tampering and bypassing in various forms, use of magnets to slow down electromagnetic meter types, damaging or altering of current and/or potential transformer circuits or ratios, and unauthorised resetting of meters are basically related to commercial losses through metering.
The most common and visible form of commercial losses is the theft of energy by direct connection to the low tension lines.

GH₵8.9bn system losses in 5 years
In respect of system losses, the losses for the five-year period is GH₵8.9 billion (GH₵8,995,639,288.99).

Yearly breakdown of system losses
The yearly breakdown of system is as follows: 2017 – GH₵1.3 billion (GH₵1,311,942,569.99)
2018 – GH₵1.4 billion (GH₵1,498,361,624.01) 2019 -GH₵1.7 billion (GH₵1,706,179,285.33)
2020 – GH₵2 billion (GH₵2,041,046,339.19) and 2021-GH₵2.4 billion (GH₵2,438,109,470.47)

Percentages for annual system losses
In respect of system losses, the percentages are 2017 (24.25%), 2018 (24.30%), 2019 (24.68%), 2020 (26.20%) and 2021 (30.31%).

System losses explained
System losses refer to the difference between total net generation (including IPPs) and energy sales on the system expressed as a percentage of net generation.

GH₵4.1bn collection losses in 5 years
Regarding collection losses between 2017 and 2021, it amounted to GH₵4.1 billion (GH₵4,125,100,000).

Figures for collection losses in each year
The figures for collection losses each year are 2017- GH₵103.1 million (GH₵103,160,000),
2018 – GH₵918.9 million (GH₵918,930,000), 2019 – GH₵79.9 billion (GH₵79,990,000), 2020 – GH₵1.4 billion (GH₵1,485,140,000) and 2021 -GH₵1.5 billion (GH₵1,537,880,000).

The collection losses are the shortfall of receivables.

1% reduction in system losses could save ECG GH₵343.2m in 5 years
Per the figures presented by the minister, one per cent reduction in system losses each year would have saved ECG GH₵343.2 million (GH₵343,253,567.26) for the five-year period.

Annual breakdown
If ECG had reduced the system losses each by one per cent, the yearly savings would have been 2017 – GH₵54.1 million (GH₵54,100,812.10), 2018 – GH₵61.6 million (GH₵61,661,052.73), 2019 – GH₵69.1 million (GH₵69,130,746.31), 2020 – GH₵77.9 million (GH₵77,913,863.81) and GH₵80.4 million (GH₵80,447,092.32).

Source: Elvis Darko || The Finder