Home Headlines World Bank Approves US$260M for Ghana’s Energy Sector and Clean Cooking

World Bank Approves US$260M for Ghana’s Energy Sector and Clean Cooking

Vice President with delegation from the World Bank
Vice President with delegation from the World Bank

The World Bank has approved a $250 million credit from the International Development Association (IDA) and a $10 million grant from the Energy Sector Management Assistance Program to support Ghana’s Energy Sector Recovery Program for Results (PforR).

This four-year initiative aims to enhance the financial viability of Ghana’s electricity distribution and expand access to clean cooking solutions.

High electricity distribution losses in Ghana, driven by low collection rates and below-cost recovery tariffs, have undermined the operational and financial performance of the country’s energy utilities. The Ghanaian government currently allocates approximately 2% of its GDP annually to cover the sector’s financial deficits.

“Through this important results-based financing, the World Bank is committed to supporting the recovery of Ghana’s energy sector and its financial sustainability. The operation aims to strengthen revenue collection and improve the quality of energy supply, including through investments in prepaid metering and in the commercial and meter management systems of distribution utilities,” said Robert Taliercio, World Bank Country Director for Ghana, Liberia, and Sierra Leone.

The PforR aligns with ongoing regulatory and policy reforms in the energy sector, supported by the World Bank’s Development Policy Finance series and the IMF Extended Credit Facility Program for Ghana. It focuses on enhancing institutional capacity and accountability, while providing direct financing to energy sector utilities for capital expenditure programs.

“The PforR aims to reduce the cost of electricity service provision by improving the economic dispatch of generation and by strengthening the commercial and operational performance of distribution utilities,” added Dhruva Sahai, Program Leader for Infrastructure.

The Clean Cooking Component of the Program will increase access to Liquified Petroleum Gas (LPG) for households, schools, and businesses in Ghana. The PforR will offer direct incentives to subsidize the cost of stoves and accessories (excluding cylinders) for first-time domestic users, commercial caterers, and secondary schools. This initiative aims to enhance women’s access to clean cooking solutions, reduce health risks from smoke exposure, alleviate time poverty, and improve women’s income-generating opportunities and employability.

About the International Development Association (IDA)

Established in 1960, the International Development Association (IDA) assists the world’s poorest countries by providing grants and low to zero-interest credits for projects and programs that foster economic growth, reduce poverty, and improve living conditions. IDA is one of the largest sources of aid for the world’s 74 poorest countries, 39 of which are in Africa. Since its inception, IDA has provided $458 billion to 114 countries. Annual commitments have averaged about $29 billion over the last three years, with approximately 70 percent allocated to Africa.

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