Govt reduces IPP debt by 20%, ensures timely power payments

President John Dramani Mahama has announced that his administration has restructured and partly settled the $1.7 billion debt owed to Independent Power Producers (IPPs), easing a major financial burden on Ghana’s energy sector.

Speaking on the second day of the 2026 Kwahu Business Forum on Saturday, April 4, the President recounted the scale of the liability inherited by his government.

“When we came into office, we had a debt overhang of about $1.7 billion owed to the independent power producers,” he said.

According to President Mahama, negotiations with the IPPs resulted in significant concessions, with producers agreeing to absorb part of the losses in line with Ghana’s broader debt restructuring efforts.

“Since Ghanaians were all taking haircuts from the debt restructuring, we told them they also must take haircuts… and they agreed… it amounted to about twenty percent of what was owed,” he explained.

He disclosed that under the agreement, the government made upfront payments to IPPs that signed onto the deal, while also establishing a clear schedule for settling the remaining balances.

“If they signed on to it, we gave them an immediate down payment, and we gave them the dates for the subsequent payment,” he added.

President Mahama highlighted that the most significant outcome of the arrangement is government’s ability to stay current on new obligations.

“The best announcement is we are keeping up with their present-day bills… any bill they submit every month, we pay them for the electricity they produce,” he stressed.

He noted that consistent payments are helping to rebuild trust with power producers and ensuring a more reliable electricity supply.

The President expressed confidence that the measures will ease financial pressure on IPPs and bring greater stability to Ghana’s power sector.