PURC Hikes Utility Prices on Oil Cost

8/29/2011 6:40:11 PM

Water up by 6.7 percent, power up by 7 percent.

Ghana's regulator on Monday increased unit prices for power and water by 7 and 6.7 percent respectively to enable providers to offset increasing cost of oil and capital investments.

The increase could raise inflationary concerns even though annual consumer inflation in the west African state fell to its lowest since 1992 to 8.39 percent in July.

Producer price inflation in the same month rose to 14.01 percent from a June fall of 12.05 percent.

Emmanuel Annang, chairman of Ghana's Public Utilities Regulatory Commission (PURC), said the hike was due to crude rising from $90 per barrel in the first quarter to $115.4 in the third quarter and an inadequate supply of natural gas for the country's thermal plant.

Sampson Akligoh of the Accra-based Databank Financial Research said the increases, though modest, would be felt in the last quarter of the year.

"Electricity and water are critical actors in the inflation basket and we'd definitely begin to see the impact of today's increases in the last quarter," Akligo said.

Source: Thomson Reuters 

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