The close relationship that many Namibians have with residents of South Africa often leads to confusion about terms used by the public when it comes to the precarious situation of electricity supply south of the Orange River.
The Managing Director of the Namibia Power Corporation, Kahenge Haulofu, with regard to the bulk electricity supplier’s announcement of debt collection plans about a week ago, said that a lot of misinterpretation of terms occurred.
We would like to clarify this, once again, by providing the correct definitions of the terms that are continuously misused,” Haulofu said.
According to Haulofu, the public notice on the re-introduction of NamPower’s Debt Collection Plan with a Debt Repayment Incentive attached to it, in which the company communicated that defaulting customers would be disconnected from electricity supply caused a lot of commotion among the members of the public and even certain media houses.
“I would like to remind you all that this was not the first time NamPower communicated its Debt Collection Plan, to sensitise its customers and the public at large, about what is owed to us by our customers and how this is affecting our operations. We issued a similar communication in 2021. The announcement is of course not a pleasant one for everyone affected, but it is necessary as collecting what is owed to us is important to the sustainability of our business and that of our country,” Haulofu stated.
According to Haulofu, NamPower’s debt from its customers currently stand at N$1,5 billion with an amount of N$842 million being overdue.
“Whilst I acknowledge and applaud a few customers who have made an effort to bring their accounts up to date, most have not bothered to heed our pleas and their debts continue to escalate,” he said.
He said that NamPower has always and will continue to engage its customers on the issue of overdue accounts.
“We do our best to enforce the collection of money owed to us in line with the provisions of the Power Supply Agreements and our Credit Policy, by having engagements, meetings and even offering instalment arrangements to the affected customers,” he said.
All the efforts and initiatives from the electricity supplier’s side have however not yielded the desired results because very few customers are making an effort to honour the instalment arrangements or to pay their outstanding accounts,
“Hence the re-introduction of the Debt Collection Plan,” he said.
Haulofu said that during the engagements, NamPower went further and offered to waive interest charges on overdue accounts settled within a 12-month period, as well as to increase the payment terms of all customers from 14 days to 20 days from the date of invoice.
“With the re-introduction of the Debt Collection Plan, we are offering the same again, and in addition an incentive to write off the interest portion of the outstanding debt accumulated over the preceding 12 months to customers who settle their outstanding amount in full on or before 31 May 2023,” he said.
The current situation prompted NamPower to investigate options that will help with addressing the matter.
“Our Power Supply Agreements give NamPower the right to totally disconnect the electricity supply of our defaulting customers as per the agreements. Hence our resolution to introduce a Debt Collection Plan, which is a scheduled disconnection of electricity supply to defaulting customers and is planned to commence on 5 June 2023,” he said.
The plan will affect those customers who do not settle their overdue accounts on or before 31 May 2023.
He said that the Debt Collection Plan will assist NamPower with recovering money owed to it and prevent the overdue accounts from increasing even further.
He gave the assurance that NamPower has considered several options on how to tackle the matter and Debt Collection Plan is the most practical solution, which will not negatively expose national infrastructure and put equipment at risk.
“The suspension of power supply is a right which NamPower has owing to the material breach of its clients’ obligations and is supported by the NamPower Credit Policy. This is a fundamental commercial condition of the PSA, which principle allows for debt recovery,” he said.
Haulofiu added that it is important to emphasise that the company has granted its customers sufficient period to make arrangements to settle their dues to give them ample time to honour their debts.
“We are happy to announce that CenoRED-Okahandja and the Lüderitz Town Council have made acceptable arrangements with respect to their accounts and have been removed from the list of defaulters,” he said.
Haulofu acknowledged the significant role that electricity plays towards the country’s socioeconomic development.
“To enable NamPower to continue delivering on its mandate, which is that of ensuring the security of supply to the nation, it is important that customers honour their commitment of paying their electricity bills timeously,” he said.
In the interest of future confusion of terms, Haulofu provided the proper definitions which are as follows:
He said that electricity suspension or disconnection is the planned disconnection of electricity supply to a customer due to a breach of contract such as the non-payment of an account or for required electrical safety measures that were not met.
He said that load-shedding is an action of load reduction achieved by manual operator action to disconnect the load at certain points on the transmission or distribution system in order to avoid a national blackout.
According to Haulofu, a blackout is an unplanned or uncontrolled interruption of power supply over a wide geographical area which has a severe impact on the affected areas.
A partial blackout is the loss of power supply to a certain supply area. The most likely cause is the failure of the transmission system supplying the specific area.
He said that a national blackout is the loss of power supply to the entire country. The most likely cause is an unforeseen sequence of events that results in a cascading loss of generation, eventually leading to a complete loss of supply across the country.
According to Haulofu, a planned outage is a scheduled power outage arranged in advance for a specific date and duration for purposes of maintenance or repairs on any apparatus.
An unplanned outage is an unscheduled interruption of power supply after a fault such as damaged powerlines due to lightning strikes, falling trees, bushfires, or general failure on apparatus has been detected.
The Debt Collection Plan that was announced by NamPower last will entail the disconnection of electricity supply to defaulting customers in stages starting from Stage 1 which will result in electricity suspension of 4 hours for one day per week.
Customers who fail to settle their debts will have these stages increased to cover an additional day each week until the plan reaches Stage 7 in week 7 where there will be a disconnection of 4 hours per day for every day of the week.
Stages 8 and 9 will see NamPower increasing the electricity suspension number of hours by 2 additional hours a day each week up to a maximum of 8 hours per day.
“We hope the above definitions will clarify any confusion or doubts that you might have had about these specific terms,” Haulofu concluded.