The World Bank has downgraded Ghana’s Energy Sector Recovery Programme from “Moderately Satisfactory” to “Unsatisfactory”. This re-evaluation follows significant delays in implementation since the programme became effective in March 2025.
Key factors driving the downgrade include funding constraints, new procurement controls, and delays by implementing agencies. Election-related disruptions also contributed to the programme falling behind schedule. These issues have hindered critical reforms aimed at improving Ghana's electricity sector.
This downgrade signals broader concerns about Ghana's economic stability and its ability to manage crucial public sector projects. It reflects the ongoing challenges Ghana faces in balancing fiscal discipline with the urgent needs of infrastructural development. The Energy Sector Recovery Programme is vital for the financial health of key state-owned enterprises like the Electricity Company of Ghana (ECG) and the Ghana Grid Company (GRIDCo).
The World Bank’s latest implementation report, dated June 30, 2026, repeatedly cited a lack of Commitment Authorizations from the Ministry of Finance. These authorizations are essential for allowing disbursements needed to facilitate the achievement of targets. Dr. Cassiel Ato Forson, the Minister for Finance, oversees the ministry responsible for these approvals.
The downgrade implies that Ghana faces continued financial strain in its energy sector. Decision-makers must address these funding and administrative bottlenecks to restore the programme's trajectory. Markets will likely monitor the government’s response to these challenges closely, especially regarding future budget allocations and procurement processes.
The Energy Sector Recovery Programme, approved in June 2024, aims to boost the financial sustainability of ECG. It also seeks to strengthen operational efficiency, reduce revenue shortfalls, and expand access to clean cooking solutions. The programme set a target to cut the combined financial losses of ECG and the Northern Electricity Distribution Company (NEDCo) to $525 million by the end of 2027.
However, the combined losses of ECG and NEDCo have risen to approximately $1.5 billion. This current figure stands significantly above the programme’s target, indicating worsening financial performance. ECG’s collection efficiency has also deteriorated to 85%, falling below the programme baseline of 86%. The long-term target is 93% by the end of 2027.
Only one programme indicator was fully achieved during the reporting period. ECG published its audited financial statements for the 2025 financial year in May 2026. However, these statements are not yet publicly available on ECG’s website. Other indicators, like the nationwide implementation of ECG's energy accounting system, are likely delayed.
The first phase of the National LPG Promotion Programme is also struggling. Only 38,000 people have received clean cooking solutions, far short of the 457,000 target. GRIDCo has also yet to submit its Security Constrained Economic Dispatch methodology to the Energy Commission. This methodology aims to reduce electricity generation costs by using lower-cost power plants first. Delays in procuring consultants for this work contribute to the overall poor performance.
The World Bank noted that new procurement directives and disbursement caps from the Ministry of Finance further slowed implementation. Ghana’s national elections and the subsequent transition to a new administration in early 2025 also impacted the programme. The World Bank anticipates that implementation can accelerate if coordination improves between the government and implementing agencies, particularly regarding approval processes.