ACEP Report Reveals Soaring Fuel Levies and Mismanagement in Ghana
A report by the Africa Centre for Energy Policy (ACEP) has exposed a sharp increase in fuel-related levies and margins imposed by the Ghanaian government, contributing to a surge in fuel prices for consumers. The report disclosed that over GHS 9.7 billion is collected annually in petroleum taxes, but much of it is allocated to debt servicing, limiting resources for development projects.
Among the key regulatory margins are the BOST Margin, Primary Distribution Margin (PDM), Unified Petroleum Price Fund (UPPF), and Cylinder Recirculation Model (CRM) margin, which together generate an estimated GHS 7.6 billion annually. ACEP noted that between 2019 and 2024, these margins have risen dramatically, with increases ranging from 247% to 429%.
The report criticized the PDM, calling it “disingenuous” because the Bulk Oil Storage and Transportation (BOST) company is often bypassed by over half of petroleum products. It also raised concerns about the Price Stabilization and Recovery Levy (PSRL), highlighting unaccounted funds and its partial use for premixed fuel subsidies.
BOST, originally intended to handle strategic stockpiling, has shifted focus by entering the petroleum import market under the Gold for Oil programme, a deviation from its core mandate. Meanwhile, the Fuel Marking Margin, which ensures fuel quality and revenue assurance, is reportedly undermined by the proliferation of proprietary marking chemicals.
Lastly, the report revealed an annual subsidy of GHS 400 million for the Cylinder Recirculation Model (CRM), which is intended to promote LPG usage. However, the levy is applied to all LPG, including that sold outside the CRM, raising equity concerns.
ACEP’s findings sheds lights on the urgent need for government accountability and a review of fuel levies to ensure transparency and equitable distribution of resources.