Times Of Swaziland: EEC WANTS 21.31% ELECTRICITY HIKE

EEC WANTS 21.31% ELECTRICITY HIKE
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Timothy Simelane on 09/11/2022 08:38:00


EZULWINI – Loading an electricity voucher of E100 could give one about 45
units, if the new tariffs envisaged by the Eswatini Electricity Company (EEC)
will get the green light, as is.
Currently, a voucher of E100 begets about 52 units for domestic customers. The
Eswatini Energy Regulatory Authority (ESERA) revealed yesterday that EEC had
applied to increase tariffs by 21.31 per cent for the year 2023/4. The 21.31 per
cent is an average multi-year tariff proposal to fully cover EEC’s costs for
each of the financial years being applied for. If approved by the Eswatini
Energy Regulatory, it will come into effect in April 2023. The consumer price
index currently stands at 4.52 per cent, according to the most recent statement
of the Central Bank of Eswatini. This, EEC said, would help the company to
finance its E2.9 billion revenue requirement for the financial year 2023/4, and
another of E3.4 billion for the following year 2004/5.
Meetings
In a meeting with the Editors Forum, ESERA Chief Executive Officer (CEO)
Sikhumbuzo Tsabedze said the application by EEC would be tested on a series of
consultative meetings with the consumers in all sectors. He outlined a
stakeholder engagement programme, which is scheduled to cover all four regions
of the country, beginning Saturday November 23 at the Siteki Hotel. Tsabedze
explained that the 21.31 per cent proposed tariff hike was not inclusive of
electrification access fund levy and Value Added Tax  (VAT) for each of the
financial years under review. The VAT was introduced for business consumers in
September this year.
Among those to be engaged on the envisaged increase in tariffs are business and
domestic consumers; trade unions and consumer groups; cane growers associations;
government ministries and others. “In terms of Section 5 (1) (f) of the Energy
Regulatory Act read with Section 32 of the Energy Act, together with Section 5
and 6 of the Tariff Methodology, ESERA is mandated to undertake a review once
the request is received by November 1, and is expected to announce a decision
not later than February 1, of the following year, after a three months review
process.”
Over the past two years, EEC had asked for E2.9 billion, but ESERA managed to
give them E2.6 billion, after relevant consultations. “This means that in the
7.6 per cent they had asked for, the authority was able to give them 1.3 per
cent for the 2022/23 year. The regulator had then also decreased the money by
1.227 per cent.” Tsabedze assured the editors that ESERA  did not approve
applications willy-nilly, but took into consideration many factors to protect
the consumers and ensure that the utility was able to meet its obligations.
Concerns
“We listen to all sides of the role players, including the concerns of the
customers as well as the utility operator. It is only after such a process that
we can state the percentage increase,” he said. The announcement came under a
volley of questions from the editors who wanted to know if, by ESERA’s
assessment of the economic situation, the nation would afford an increased
tariff. The editors also wanted to know what ESERA was doing to ensure there
were alternative sources of electricity generation to control the price
increase. Tsabedze said in their engagements with EEC, they would ask for
answers on the reasons for the increase. He said investments into alternative
power generation were welcome, but must be made prudently to ensure they were
not heavily capital intensive.