Erongo RED explains tariff increase, resolutions taken

1.7% adjustment

16 September 2021 | Energy

Fessor Mbango; Erongo RED CEO; “We have considered all possible ways to ensure that we pass on the least and reasonable tariff adjustments to the customers…”

Walvis Bay • [email protected]



An electricity tariff increase of 1.7% has been in effect from July 2021 and runs until June 2022.

More light was shed on this adjustment by Erongo RED during a media conference in the harbour town on Tuesday.

Chief executive of the regional electricity distributor, Fessor Mbango, explained that the Electricity Control Board (ECB) announced that NamPower’s average tariff would increase from N$1.65 to N$1.69 per kilowatt-hour for the 2021/22 financial year.

“This constitutes a weighted average increase of 2.92%. However, the actual impact on Erongo RED is 3.6%. NamPower’s tariff forms the baseline for Erongo RED’s tariff increase, as it is the biggest expenditure. Thus, NamPower’s tariffs affects our tariffs and impacts consumers.”

After the announcement by NamPower, Erongo RED applied to the ECB for a tariff adjustment increase of 1.7% for this financial year.

“The ECB approved the weighted average of 1.7%. This adjusted tariff resulted in increases on different customer segments. The impact will vary depending on individual consumer consumption patterns. The ECB levy remains unchanged from 1 July 2021 to 31 June 2022. The ministry of mines and energy has not pronounced themselves on the NEF levy for the 2021/22 financial year.”

Mbango added that Erongo RED has not increased electricity tariffs for the past two years.

“We have taken a number of resolutions for the 2021/22 financial year. Despite the increase, pensioners will continue to enjoy other benefits such as no basic charges up to 40-ampere circuit breakers. Pensioners will also continue to enjoy subsidized tariffs (special tariffs) up to 40-ampere circuit breakers, and installation of prepaid box is free for pensioners.”

He said that Erongo RED has also resolved to continue with lifeline (cheaper) tariffs for customers on the 20-ampere circuit breakers. These customers will be charged on the inclining block tariffs.

Block Tariffs

Inclining Block Tariffs means that the electricity price is divided into three blocks.

The first block of electricity is at the lowest price for the first 100 units. As the customer purchases more electricity during the month, the electricity bought will eventually fall in block 2 for the next 400 units, which is a bit more expensive.

This process repeats automatically as the customer purchases further electricity to move into the last block, which is above 500 units.

At the end of each month, the history is reset and the customer will again start the next month from block 1. Thus, the first 500 units for this customer segment is subsidized.

Pre-paid customers above 20 amp connections, will continue on the flat tariff structure. Customers in this category will be charged the same rate throughout the month.

“We have also decided to continue with the free pre-paid meter project for pensioners and customers who are on debt management,” Mbango said.

He emphasised that Erongo RED wants to support vulnerable members of the community, especially customers who cannot afford to pay the actual retail tariffs.

“We advise them to move to the lifeline tariff provided they meet the qualification criteria set out in the Social Tariff policy. Although it requires a behavioural change in how we use electricity, a person can comfortably manage with the 20 amperages with all basic household appliances connected.”

He advised that if consumers use electricity sparingly, they will spend less on electricity, but if people use the electricity carelessly then they will have to pay for the energy consumed.

Erongo RED currently subsidizes around 10 600 customers, which consists of pensioners and lifeline customers. This represents 24% of the active customer base of the regional electricity distributor.

Mbango also explained that for this financial year, Erongo RED took into account the current economic situation and the impact of electricity costs on commercial and industrial customers, as well as the impact of Covid-19 on industries, businesses, farmers and residential consumers.

Furthermore, “we cut our expenditure and put some of our projects on hold to accommodate our customers,” Mbango concluded.

Similar News

 

Namcor oil storage report exposes shortcomings

1 week ago - 08 October 2021 | Energy

Windhoek ∙ [email protected] due diligence report sanctioned by the National Petroleum Corporation of Namibia (Namcor) as well as sensitive ministerial correspondence into the state of...

Fuel price increase could promote smuggling

1 week ago - 05 October 2021 | Energy

Windhoek ∙ [email protected] After the Ministry of Mines and Energy announced that fuel prices will increase by 30 cents per litre (c/l), people expressed...

Namcor oil storage report exposes shortcomings

1 week ago - 04 October 2021 | Energy

Windhoek ∙ [email protected] A due diligence report sanctioned by the National Petroleum Corporation of Namibia (Namcor) as well as sensitive ministerial correspondence into the...

Fuel prices on the up

1 month - 30 August 2021 | Energy

The price of fuel will increase by 60 cents per litre for petrol and 30 cents per litre for diesel on Wednesday (1 September).According to...

Fuel prices remain unchanged

2 months ago - 03 August 2021 | Energy

The ministry of mines announced that it will not adjust fuel prices given current economic circumstances, but warned that this may be short-lived.At the moment,...

Fuel prices to increase

3 months ago - 30 June 2021 | Energy

The price of both petrol and diesel will increase by 40c per litre on Wednesday, 7 July at 00:00. The fuel pump prices (in Walvis...

Fuel unchanged, but RFA levy increased

4 months ago - 28 May 2021 | Energy

While the energy ministry announced that fuel prices for June remain unchanged, the finance ministry approved an increase of 7c/l in the Road User Levy...

Small increase in NamPower tariffs

5 months ago - 30 April 2021 | Energy

The Electricity Control Board (ECB) announced that it has approved an increase of 2.92% in the average bulk electricity tariff after an application by NamPower...

Fuel prices unchanged for May

5 months ago - 28 April 2021 | Energy

The ministry of mines announced that fuel prices would remain unchanged for the month of May.This is mainly thanks to a stabilisation of oil prices...

Dispute around appointments

6 months ago - 05 April 2021 | Energy

Swakopmund • Erwin Leuschner The Swakopmund town council, which is dominated by several opposition parties, continues to set an example.During the recent council meeting...

Latest News

First-ever career week at Duinesig

15 hours ago | Education

Swakopmund • [email protected] Duinesig High School hosted its first-ever career week from 11 to 15 October. Universities and colleges joined forces as exhibitors and...

Volkswagen Caddy to retail in...

15 hours ago | Motors

Volkswagen Commercial Vehicles will be launching the new Caddy in South Africa from November 2021. The Caddy was first launched in the local...

Vaccination uptake not satisfactory ...

15 hours ago | Ministries

The number of new Covid-19 infections have significantly decreased in the past few weeks. Health minister Dr Kalumbi Shangula stated that the decline in...

Blue Waters up against Pro-Ed...

21 hours ago | Sports

Blue Waters will face Pro-Ed Old Boys Cricket Club I in the final of this year’s edition of the Coastal T20 Cricket League.Helmut Mack confirmed...

Elderly person murdered

1 day - 16 October 2021 | Crime

The police are appealing for help from the public to find the suspects wanted in connection with a murder and a housebreaking with intent to...

Kudus II ready for Unam...

1 day - 15 October 2021 | Sports

Walvis Bay •[email protected] The FNB Kudus II team will meet the University of Namibia (Unam) II in a Namibia Rugby Union (NRU) reserve...

World Food Day supported

1 day - 15 October 2021 | Local News

Swakopmund • [email protected] Hodago Fishing handed over 25 food parcels to the office of the governor, in support of World Food Day that...

Hydrogeological map launched

1 day - 15 October 2021 | Environment

Windhoek • [email protected] The minister of agriculture, water and land reform says that, in his opinion, a total ban on prospecting and mining activities...

NCAF workshop conducted

1 day - 15 October 2021 | Ministries

Swakopmund • [email protected] An estimated 50 stakeholders from various institutions attended the seventh National Conservation Agriculture Forum (NCAF) workshop which was conducted...

Load More