Ghana has paid $1.47 billion to clear legacy debts in its energy sector, restoring confidence among lenders and power producers and easing a major constraint on electricity supply, the country’s finance ministry said on Monday.
The payments, made in 2025, were used to settle arrears owed to independent power producers, gas suppliers and the World Bank, whose partial risk guarantee had been depleted by years of unpaid obligations.
Ghana’s power sector has long struggled with mounting debts that contributed to frequent outages and discouraged new investment. Last year, President John Dramani Mahama pledged to cut the sector’s estimated $2.5 billion debt to power producers and gas suppliers.
“The era of uncontrolled energy sector debt accumulation is over,” the finance ministry said, adding that tighter fiscal discipline enabled the repayments while provisions were made to meet future obligations on time.
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According to the ministry, more than $597 million was paid to the World Bank, fully restoring the partial risk guarantee for gas supplies from the Offshore Cape Three Points field. The guarantee, created in 2015, was designed to protect nearly $8 billion in private investment in the energy sector but had been eroded by arrears.
The government also paid $480 million to Italian energy firm ENI and commodities trader Vitol to settle outstanding gas invoices linked to electricity generation from the Sankofa Gas Project.
In addition, about $393 million in legacy debts owed to independent power producers were cleared, including $120 million paid to Turkey’s Karpowership and $59.4 million to Cenpower Generation.
Independent power producers said in a separate statement that clearing the long-standing debts marked a major step toward restoring financial stability and operational confidence in Ghana’s electricity market.
The finance ministry said the government has renegotiated all power purchase agreements with independent producers and is working with Tullow Oil and Jubilee Field partners on a structured payment roadmap.
Ghana is also seeking to increase domestic gas production and reduce its reliance on costly liquid fuels, a move officials say will lower power generation costs and improve supply reliability.