Southern, central REDs in 2018

OGONE TLHAGE The Electricity Control Board (ECB) is pushing ahead with plans to finalise the formation of two new regional electricity distributors (REDs).ECB chief executive Foibe Namene says the southern and central areas can expect REDs as soon as next year.“It is expected that the Southern Regional Electricity Distributor (SORED) will be established by early 2018 and the Central Regional Electricity Distributor by end of 2018,” Namene said recently.She ascribed the delay of the formation of the two regional distributors to several issues, which included a perceived loss of revenue by local authorities and the lack of a binding legal framework.“The delay in the formation of SORED and Central RED was caused by several factors comprising of the perceived loss of revenue made from electricity, shareholding issues and lack of a binding legal framework on the establishment of REDs. However, developments in the industry for the past 10 to 15 years have shown that there is no better alternative to the REDs business model,” she said.“During a national stakeholder summit held in 2014 there was consensus that the establishment of the two remaining REDs has to be finalised,” she said.Currently, the greater Windhoek area, Dordabis and Gobabis all procure electricity directly from NamPower while the Keetmanshoop town council has been engaged in a protracted battle to sever ties with its electricity supplier, the Southern Electricity Company (SELco).Highlighting the advantages of regional electricity distributors, Namene said: “REDs have been effective at refurbishing and replacing aged assets and managed to contain and reduce network losses. Yes, they are fulfilling their purpose. The REDs’ contribution to the supply of electricity throughout Namibia has undoubtedly been a success.“RED business operations are viable and shareholders receive dividends. For local authorities and regional councils it further means that they can be assured that their electricity functions are performed by a competent entity, with the capacity to provide good quality electricity services at required standards to their consumers.“The REDs leverage economies of scale and harmonised tariffs and service delivery. They are self-sufficient and therefore do not need government financial bailouts as was the case in the past and currently with certain local authorities, village councils and regional councils.“REDs are able to raise commercial loans for network development, they are technically oriented and better able to operate and maintain the network infrastructure facilities. As a result, consumers do not experience NamPower cut-offs due to non-payment,” she continued.According to her, Erongo RED had paid N$422 million in local authority supercharges, CENORED N$204 million and NORED N$87 million over the period 2006 – 2014.Commenting on the implementation of the southern electricity distributor, she said: “The Southern RED will come into effect this year or early 2018 and this is very important to the EDI reform since the process had been ongoing for a very long time.“Therefore, the ECB is optimistic that a fourth RED will join the ESI and uphold the criteria it is based upon.”

Southern, central REDs in 2018

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Namibian Sun 2025-06-19

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Southern, central REDs in 2018

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Namibian Sun 2025-06-19

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