ErongoRED announced steep tariff hike

Niël Terblanché

Residents of the Erongo Region in Namibia will have to embrace an enhanced financial strain as the regional electricity distributor announced a significant 8.97 percent hike in electricity tariffs.

The increase comes in the wake of the Electricity Control Board (ECB) declaration regarding a rise in NamPower’s average tariff from N$1.82 to N$2.12 per kilowatt-hour for the fiscal year 2023/2024.

Acting CEO of Erongo RED, Nico Niemand, confirmed that the revised tariffs are not confined to the Erongo Region but are slated to have a nationwide implementation.

“The impact of the increase on customers will vary, depending on their individual consumption patterns and the type of connection,” he said during the recent announcement.

According to Niemand, approximately 70 percent of every unit sold is allocated to NamPower, leaving ErongoRED with a residual of 30 percent to fund its operations.

The alteration in tariffs has diverse implications, influenced by operational and maintenance costs, customer service, overheads, and working capital, all contributing to the aggregate cost of electricity provision to the end-users.

In light of the added financial burdens on the residents, Niemand emphasized the concerted efforts made to assuage the impact on the consumers, ensuring that the service delivery remains unscathed.

“We had to explore all possible avenues to minimize the impact on our customers while ensuring service delivery remains uncompromised,” Niemand said.

In line with this, ErongoRED continues to uphold subsidized tariffs for pensioners and low-income residents of the community, emphasizing the need for re-registration by pensioners in Erongo to sustain the benefits of the existing subsidised tariffs.

Niemand urged eligible residents to proactively seek social tariffs by visiting the nearest Erongo Red offices and initiating the application process.

Despite the mounting tariffs, Niemand assures that the ECB levy will maintain its current status, witnessing no change from 1 July 2023 to 30 June 2024. Concurrently, there is no foreseeable escalation in the National Energy Fund levy for the ensuing financial year.

The escalation in electricity tariffs encapsulates a broader national perspective, with the Erongo Region mirroring the financial recalibrations occurring nationwide.

According to Niemand the top management of ErongoRED is actively engaged in navigating the transition, focusing on mitigating the effects on the consumer base, particularly the vulnerable sections of the community, and maintaining a balanced approach to operational sustainability and consumer welfare.

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