From Grid Connection to Energy Poverty: Challenges of Prepaid Metering in Ghana

The study examines how prepaid metering systems in Ghana's urban poor communities exacerbate energy poverty due to affordability and reliability issues, suggesting the need for a redefined energy access approach and increased investment in renewable energy. It highlights the importance of community involvement in energy decision-making to ensure equitable access.

A study conducted by Julian Bloomer and Dickson Boateng from the Department of Geography at Mary Immaculate College, University of Limerick, explores the multifaceted issue of energy poverty among urban poor communities in Kumasi, Ghana. Despite Ghana's significant strides in improving electricity access, particularly through the implementation of prepaid metering systems, the study reveals that urban poor households still face substantial barriers that prevent them from fully benefiting from this essential service. These barriers include the reliability, adequacy, availability, and affordability of electricity. Even though many households are connected to the national electricity grid, these issues force them to resort to alternative energy sources that are often harmful to the environment and less reliable.

The Unintended Consequences of Prepaid Metering

Prepaid metering systems, which have been rolled out across many urban areas in Ghana, were intended to enhance electricity access and ensure that revenue is successfully recovered. However, the findings of this study indicate that these systems may, in fact, exacerbate the financial burden on low-income households. For many urban poor households, the requirement to pre-finance electricity usage means they often cannot afford to maintain a consistent supply of electricity, leading to frequent disconnections. This situation is particularly dire given that electricity usage is closely linked to income levels; those with higher incomes can afford more electricity, while those with lower incomes struggle to meet their energy needs. The socioeconomic shocks brought on by the COVID-19 pandemic and the ongoing Russia-Ukraine war have further complicated this scenario. These global crises have severely impacted the incomes of those working in the informal sector, where many of Ghana’s urban poor are employed, making it even more challenging for them to afford electricity. Rising inflation and increasing costs of basic needs, including energy, have left these households in a precarious position, where they must choose between essential needs such as food, shelter, and energy.

Hidden Energy Poverty: Beyond the Grid Connection

The study also highlights the disparity between the potential access to electricity (being connected to the grid) and the realized access (the ability to afford and utilize the electricity). In many cases, households may have access to electricity in the sense that they are connected to the grid, but they do not have the means to fully utilize this connection due to the high cost of electricity and the unreliable supply. This hidden energy poverty, where consumers use less electricity than they need to avoid high bills, is a significant issue that needs to be addressed if Ghana is to meet its Sustainable Development Goals (SDG 7), which aim to ensure access to affordable, reliable, sustainable, and modern energy for all. In Ghana, the energy poverty experienced by urban poor households can be likened to the concept of fuel poverty, typically associated with the Global North. In this context, energy poverty is not just about a lack of access to electricity but also about the social and material conditions that prevent people from utilizing the electricity they have access to. These conditions include low income, lack of savings, and living in rented accommodations where tenants may not have the power to make decisions about energy usage.

Redefining Energy Access for Real Impact

The study suggests that the current definition of energy access, which often focuses on mere connectivity to the grid, needs to be reexamined. Instead, energy access should be understood as a combination of potential access (connection to the grid) and realized access (the ability to use and afford electricity). This broader definition would help identify those who are energy-poor despite being connected to the grid and would inform more effective policy interventions. Furthermore, the research advocates for increased investment in renewable energy, particularly solar technologies, as a way to improve electricity access in urban poor communities. Ghana has a significant potential for solar energy, but this resource remains largely untapped. By investing in solar technologies, the country could diversify its energy sources, reduce the load on the national grid, and provide more affordable and reliable electricity to urban poor households.

Community Involvement: A Key to Success

The study also calls for greater community involvement in energy decision-making processes, particularly regarding the implementation of prepaid metering systems. The lack of consultation and sensitization in the switch from post-paid to prepaid metering has led to resistance and dissatisfaction among many consumers. Addressing these issues through increased transparency, community engagement, and the provision of affordable alternatives to grid electricity, such as solar home systems, could help alleviate some of the challenges faced by urban poor households.

Toward Sustainable Energy Solutions

The study underscores the importance of rethinking energy access in urban poor communities in Ghana. While the introduction of prepaid metering systems and the expansion of the electricity grid are important steps forward, they are not sufficient on their own. Without addressing the underlying issues of affordability, reliability, and adequacy of electricity, many urban poor households will continue to experience energy poverty, limiting their ability to improve their quality of life and contribute to sustainable development. Investing in renewable energy, fostering community involvement, and redefining what it means to have access to energy are crucial steps toward ensuring that the benefits of electricity access are equitably distributed, and that these communities are not left behind in the push toward sustainable development.