Erongo electricity tariffs increased
The new tariffs are effective from the beginning of this month.
Otis Finck at Walvis Bay - The Erongo Regional Energy Distributor (Erongo RED) announced an average weighted tariff increase of 4% for the period July 2018 to June 2019.
Fessor Mbango, the CEO of Erongo RED, told members of the media on Friday in Walvis Bay, that the increase comes after NamPower was granted a 5% average weighted tariff increase for the same period.
He said that the new tariffs would apply to all customer categories in the Erongo region except for some mining companies directly fed by NamPower.
Mbango added that due to slow economic activities over the last two years, large power users would only receive a 2% increase for 2018/19 in order to stimulate business activities in the region.
“Erongo RED submitted an application to the Electricity Control Board (ECB) to adjust electricity tariffs for the 2018/2019 period. The ECB reviewed and approved the application and new tariffs will be applied to customers effective 1 July 2018.”
Mbango explained that the 4% weighted average increase is the weighted average of different tariff categories applied to different groups of consumers in the Erongo Region.
“The ECB levy increased by 7% and an announcement on the National Energy Fund (NEF) levy will be made. NamPower announced an average tariff increase of 5% country wide in May 2018. The impact of this increase on Erongo RED is 5%, which means that the electricity provider will be paying an average N$1.69 per kWh on bulk tariffs.
“Taking into account the increase by NamPower and other associated costs the ECB granted Erongo RED an average tariff increase of 4% effective from 1 July 2018. In compliance with the approval by the ECB, the regional energy distributor will pass weighted average of a 4% tariff increase on its customers.”
Mbango pointed out that it should be noted that the 4% tariff increase is a weighted average of different tariff categories and the actual impact on customers will vary according to tariff category on which they are connected and their consumption pattern.
Categories
The actual tariff increase per different customer segment will thus be 5% for domestic single-phase users, pensioners (prepaid/conventional) and business single-phase users.
Prepaid customers above and below 20 ampere as well as institutional single phase customers will pay 4% more. The same apply to business 3 phase, prepaid business above 30 amps and prepaid business up to 30 amps consumers.
Institutional large power users will pay 3% more. Institutional three phase and large power users will pay 2% more.
Mbango also announced that the current block tariffs scheme (including blocks) would be reduced from 0-150- to 0-100 on the first block. The second block will be reduced from 151-650 to 101-500 and the last block from 650+ to 500+.
“These limitations are being introduced to enforce controls over social tariffs, reduce the misuse of the social tariff and to ensure that only the pro-poor benefit from this tarrif, effective 1 July 2018. Erongo RED reduced the current subsidy on up to 30 Amp to 20Amp.”
Customers currently on the up to 30 Amps prepaid social tariff will no longer qualify for the subsidy and must visit the nearest pay point to re-apply for 20 Amps.
In order to qualify for the new up to 20Amp prepaid social tariff, customers will have to reduce their circuit breaker from 30 Amp to 20 Amp. Erongo Red will carry the initial cost of the circuit breaker reduction.
Subsidy
Mbango told journalists previously (2017) that the company spend approximately N$15 million subsidising the cost of electricity on pensioners and low-income segment of the community in 2016/17.
“The subsidy supports over 17 000 customers throughout the region of which 5262 are pensioners registered with Erongo RED. As opposed to the previous years, free prepayment installation only became applicable to pensioners who are up to 40 amps connection size and the customers that are on the Debt Management programme.”
He further explained that electricity prices are in general influenced by elements such as costs associated with generation, transmission, distribution and supply of electricity.
He also mentioned other factors such as the upgrading of the network, operational costs, connection of new development s as well as the costs to replace aging electricity infrastructure.
Impact
He further emphasised that Erongo Red was fully aware of the impact an electricity tariff increase has on customers and therefore strive to pass on tariffs that are reasonable and cost effective.
“Erongo Red has since 2012 put measures in place to cushion the impact of electricity on customers especially pensioners and the low income segment in communities.”
Mbango gave the assurance that Erongo Red looked into all possible ways to ensure that the impact of tariffs increases on customers are cushioned and to ensure that the company operate sustainably.
He said that particular attention is also been paid to investing in capital projects to ensure a robust network to meet the demand for electricity.
“When determining tariffs this year, Erongo RED looked at various factors such as the impact of the 5% increase by NamPower on the regional electricity distributor, the impact on end users, envisaged capital projects, electrification projects, the replacement of aging infrastructure and the servicing of loans. The company also took into account the socio-economic challenges of customers including the impact of electricity cost on commercial and industrial customers.”
Information sessions with shareholders, the public and pensioners were conducted in June 2018 to sensitise everybody about the anticipated tariffs. Information sessions will also be conducted to educate the public on electricity safety and electricity saving tips.
Mbango also cautioned that during the winter period (June, July and August) consumers will experience high bills especially customers on time of use (TOU) meters.
He said that the high bills are mainly driven by high usage of electricity during winter, which translate into higher bills and urge all customers to use electricity sparingly during this particular period.
Fessor Mbango, the CEO of Erongo RED, told members of the media on Friday in Walvis Bay, that the increase comes after NamPower was granted a 5% average weighted tariff increase for the same period.
He said that the new tariffs would apply to all customer categories in the Erongo region except for some mining companies directly fed by NamPower.
Mbango added that due to slow economic activities over the last two years, large power users would only receive a 2% increase for 2018/19 in order to stimulate business activities in the region.
“Erongo RED submitted an application to the Electricity Control Board (ECB) to adjust electricity tariffs for the 2018/2019 period. The ECB reviewed and approved the application and new tariffs will be applied to customers effective 1 July 2018.”
Mbango explained that the 4% weighted average increase is the weighted average of different tariff categories applied to different groups of consumers in the Erongo Region.
“The ECB levy increased by 7% and an announcement on the National Energy Fund (NEF) levy will be made. NamPower announced an average tariff increase of 5% country wide in May 2018. The impact of this increase on Erongo RED is 5%, which means that the electricity provider will be paying an average N$1.69 per kWh on bulk tariffs.
“Taking into account the increase by NamPower and other associated costs the ECB granted Erongo RED an average tariff increase of 4% effective from 1 July 2018. In compliance with the approval by the ECB, the regional energy distributor will pass weighted average of a 4% tariff increase on its customers.”
Mbango pointed out that it should be noted that the 4% tariff increase is a weighted average of different tariff categories and the actual impact on customers will vary according to tariff category on which they are connected and their consumption pattern.
Categories
The actual tariff increase per different customer segment will thus be 5% for domestic single-phase users, pensioners (prepaid/conventional) and business single-phase users.
Prepaid customers above and below 20 ampere as well as institutional single phase customers will pay 4% more. The same apply to business 3 phase, prepaid business above 30 amps and prepaid business up to 30 amps consumers.
Institutional large power users will pay 3% more. Institutional three phase and large power users will pay 2% more.
Mbango also announced that the current block tariffs scheme (including blocks) would be reduced from 0-150- to 0-100 on the first block. The second block will be reduced from 151-650 to 101-500 and the last block from 650+ to 500+.
“These limitations are being introduced to enforce controls over social tariffs, reduce the misuse of the social tariff and to ensure that only the pro-poor benefit from this tarrif, effective 1 July 2018. Erongo RED reduced the current subsidy on up to 30 Amp to 20Amp.”
Customers currently on the up to 30 Amps prepaid social tariff will no longer qualify for the subsidy and must visit the nearest pay point to re-apply for 20 Amps.
In order to qualify for the new up to 20Amp prepaid social tariff, customers will have to reduce their circuit breaker from 30 Amp to 20 Amp. Erongo Red will carry the initial cost of the circuit breaker reduction.
Subsidy
Mbango told journalists previously (2017) that the company spend approximately N$15 million subsidising the cost of electricity on pensioners and low-income segment of the community in 2016/17.
“The subsidy supports over 17 000 customers throughout the region of which 5262 are pensioners registered with Erongo RED. As opposed to the previous years, free prepayment installation only became applicable to pensioners who are up to 40 amps connection size and the customers that are on the Debt Management programme.”
He further explained that electricity prices are in general influenced by elements such as costs associated with generation, transmission, distribution and supply of electricity.
He also mentioned other factors such as the upgrading of the network, operational costs, connection of new development s as well as the costs to replace aging electricity infrastructure.
Impact
He further emphasised that Erongo Red was fully aware of the impact an electricity tariff increase has on customers and therefore strive to pass on tariffs that are reasonable and cost effective.
“Erongo Red has since 2012 put measures in place to cushion the impact of electricity on customers especially pensioners and the low income segment in communities.”
Mbango gave the assurance that Erongo Red looked into all possible ways to ensure that the impact of tariffs increases on customers are cushioned and to ensure that the company operate sustainably.
He said that particular attention is also been paid to investing in capital projects to ensure a robust network to meet the demand for electricity.
“When determining tariffs this year, Erongo RED looked at various factors such as the impact of the 5% increase by NamPower on the regional electricity distributor, the impact on end users, envisaged capital projects, electrification projects, the replacement of aging infrastructure and the servicing of loans. The company also took into account the socio-economic challenges of customers including the impact of electricity cost on commercial and industrial customers.”
Information sessions with shareholders, the public and pensioners were conducted in June 2018 to sensitise everybody about the anticipated tariffs. Information sessions will also be conducted to educate the public on electricity safety and electricity saving tips.
Mbango also cautioned that during the winter period (June, July and August) consumers will experience high bills especially customers on time of use (TOU) meters.
He said that the high bills are mainly driven by high usage of electricity during winter, which translate into higher bills and urge all customers to use electricity sparingly during this particular period.
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