ECB fights for ‘burdened’ consumers
Briefing the Parliamentary Standing Committee on Economics, Natural Resources and Public Administration this week, the Electricity Control Board (ECB) CEO, Siseho Simasiku made three recommendations that he says will bring relief to the consumers while protecting the local authorities’ and regional council’s revenue.
Simasiku said government should subsidise the full amount of N$213 million that local authorities get annually as surcharges. This means that the amount that consumers of electricity are currently paying as surcharges to the local authorities or regional councils will be paid by government. As a result of such a move, if agreed to by government, consumers will pay 13.12/kWh.
If this is not acceptable, the ECB proposed that the Local Authority surcharge be fixed to 15c/kWh for all local authorities and regional councils. Currently some local authorities and regional councils such as Grootfontein charge as high as 40c/kWh as surcharges while others like Rehoboth charge as low as 5c/kWh. Simasiku said the fixed levels should be phased in over a period of three to five years and government should subsidise the difference of those local authorities’ surcharges above 15c/KWh.
While this means relief to consumers in areas such as Grootfontein, Luderitz, Henties Bay and Gobabis, there will be no relief for consumers living in areas below this new threshold. This move will also result in a cost of N$82.2 million to government annually in subsidies.
Simasiku also proposed that the local authorities surchage be fixed at 15c/kWh to be reviewed every two to three years while also allowing for inflationary adjustments to be made. He argued that this will be in the best interest of local authorities and regional councils since the Local Authority surcharge will keep up with inflationary pressures.
The ECB also called on the government to exempt REDs from paying corporate tax as it will make them more financially viable. Simasiku said the REDs, which were created under the Company Act, will also benefit from tax exemptions through the availability of more capital for infrastructure investment if they were exempted.