Cama speaks on single buyer operations
Consumers Association of Malawi (Cama) has expressed fear over the operationalisation of Power Market Limited (PML) which it says may hurt consumers.
In a letter dated March 17 2022 addressed to Ministry of Energy Principal Secretary, Cama executive director John Kapito argued that electricity prices are already beyond the affordability of many consumers, as such, establishing institutions like PML would be a cost to consumers.
He said: “Currently, consumers are paying K2 per kilowatt for the functions of the single buyer and the decision by government to create an independent parastatal for the function of the single buyer will demand a higher electricity tariff increase for the operations of the single buyer.
“Public sector reforms are intended to bring efficiencies and reduce the cost of doing business and, therefore, the establishment of PML creates a huge cost for the supply of electricity which can be avoided if left within Escom.”
PML was granted a single buyer licence by the Malawi Energy Regulatory Authority (Mera) in December 2020 to buy all electricity from power producers, including importing and selling this electricity in Malawi.
Meanwhile, former Escom chief executive officer Kandi Padambo, in a special paper on the single buyer role, has indicated that it would be ideal for the holder of power transmission licence to simultaneously hold licences for distribution, imports, export systems, market operator and single buyer.
In a written response to an e-mailed questionnaire earlier, Mera consumer affairs and public relations manager Fitina Khonje said the PML is there to ensure independence, financial or otherwise, regarding market transactions to ensure that all market players are duly and timely paid for the services they would have rendered in the power market.
