By Staff Reporter

THE Namibian government through the Ministry of Mines and Energy,  and the Electricity Control Board has availed a tune of N$365 million to subsidise electricity to all consumers in Namibia for the 2024/ 2025 financial year.

This was announced by Mr. Robert Kahimise, Chief Executive Officer of Electricity Control Board (ECB) on Wednesday,  that this came as a government intervention to assist electricity consumers.

“In line with Section 27 of the Electricity Act No 4 of 2007, the Board approved an effective 8% bulk electricity tariff for NamPower for the financial year 2024/2025, announced on the 26^th of April 2024 and thereafter, the tariff approvals for the major distribution utilities announced on 27 June 2024. The approved tariffs were effective from 1^st  of July 2024.” Explained Mr. Kahimise

He added that the subsidy has been granted in response to the plight of the Namibian nation on the affordability of electricity, and later the Minister of Mines and Energy, Mr. Tom Alweendo engaged the ECB, to collectively look into the plight of electricity consumers.

“In this regard, the Government resolved to avail approximately N$ 365 million to subsidise electricity consumers for the 2024/2025 financial year effective 1 July 2024 to 30 June 2025.”

ECB Chief Executive Officer explained that the consumers will pay the same tariffs as per the schedule of approved tariffs for 2023/2024. The ECB Board will allow Licensees to deviate from the approved 2024/2025 Approved Schedule of Tariffs as per Section 27(3) of the Electricity Act.

“Approximately N$ 221 million of the N$365 million has been set aside to assist NamPower to execute its mandate and to ensure un-interrupted security of electricity supply. The remaining Nt 144 million will be utilised by the distribution utilities to lessen the impact of the electricity tariff on their customers for the said period.

As such, the public is hereby informed that the ECB will engage the Licensees on the modalities for recovering their approved revenue requirements for the 2024/2025 financial year.”

In May and June this year, ECB has conducted its first-ever public meetings with stakeholders and the regional electricity distributors in all 14 regions of Namibia on the new tariff increasement for 2024/2025 financial year.

ECB Interventions to address affordability

The Electricity Control Board has co-opted the implementations of the interventions to fulfil the affordability of tariffs as follows : “Approval of targeted social tariffs (e.g. pensioner tariffs, low consuming household tariffs); Assessment of the impact of tariffs on vulnerable groups through a KPI on percentage of electricity cost vs household income as part of the annual tariff review process; Assessment of the impact of tariff approvals on the economy; Implementation of the MSB market model aimed at reducing imports and generation tariffs; The utilisation of the Long Run Marginal Cost Fund (i.e. construction of the 20MW Omburu PV Plant with a tariff of 16 cents/ kWh, and to cushion price increases).”

Energy supply situation in SADC

Mr. Kahimise further added that “there is a substantial shortage of energy in the Southern Africa region at this stage and this situation will prevail over the next several years until enough new generation and transmission capacity has been built; thus, putting pressure on energy tariffs not only in Namibia but in the entire SADC region.

Specifically, the drought situation in countries where Namibia imports power from such as Zambia and Zimbabwe, it is necessary that NamPower has sufficient funds to procure power from alternatives when necessary to ensure security of supply.”

ENDS…