Ghana Water to receive extra revenue if non-revenue water falls below 40% – PURC

Ghana Water Limited, the country's water utility, could earn extra revenue if it brings its non-revenue water rate below 40 percent, the Executive Secretary of the Public Utilities Regulatory Commission (PURC) revealed. Dr Shafic Suleman made this disclosure during a discussion on Joy FM’s Super Morning Show on Wednesday, September 2nd, about the state of Ghana's water quality and accessibility.

The PURC currently permits Ghana Water a non-revenue water benchmark of 45 percent under the five-year Multi-Year Tariff Order. However, the regulator anticipates this figure to drop progressively to approximately 43 percent within three years. Presently, Ghana Water’s non-revenue water rate is at 47.6 percent, surpassing the regulatory threshold.

"Should they manage to reduce it below 40 percent, they will receive an additional incentive as revenue to invest in their future infrastructure," Dr Suleman explained. This incentive-based regulatory framework also imposes penalties on Ghana Water if it fails to meet the established benchmark. "Even if they do not meet the 45 percent benchmark and progressively [reduce it] to 43 percent, they are penalized because the tariff cannot cover the necessary revenue," Dr Suleman elaborated.

The PURC is keeping a watchful eye on Ghana Water’s infrastructure investments and may tighten the benchmark if the utility consistently reduces its non-revenue water rate to about 40 percent for three or four consecutive months. Non-revenue water refers to treated water that does not generate income for the utility due to leakages, theft, illegal connections, faulty meters, and billing issues.