MPs ask Mera to freeze electricity tariff hike
A joint parliamentary committee has asked Malawi Energy Regulatory Authority (Mera) to ignore a proposed electricity tariff hike by Electricity Supply Corporation of Malawi (Escom) and Power Marketing Limited (PML), saying Malawians are struggling economically.
Mera yesterday told the committee comprising Natural Resources and Climate Change, Public Accounts, Legal Affairs and Trade and Industry that it has received a request to raise electricity tariff for the next four years from 2022 to 2026.
Mera chief executive officer Henry Kachaje said the authority is expected to determine and approve the new base tariff by November 2022.
But the joint committee co-chairperson Welani Chilenga said Malawians are going through economic challenges and it would be unfair to increase electricity tariffs.
He said: “If ever there was a time tariffs should not have been increased, it is now. His Excellency the State President [Lazarus Chakwera] announced austerity measures… because we are in a very difficult economic situation.”
Chilenga, who is also Chitipa South legislator, instead asked Electricity Generation Company Egenco to work on resolving the power outages, including restoring Kapichira Hydro Power Station which was incapacitated following Tropical Cyclone Ana in January this year.
Another co-chairperson Simplex Chithyola Banda agreed with Chilenga, saying the proposed tariff hike should be put on hold.
“Hiking the electricity tariff now will just burden many Malawians,” he said.
In response, Kachaje said the austerity measures do not stop legally constituted functions that need to take place.
He said the process of tariff negotiations has provisions on what needs to be done and request for tariff adjustment by a licensee is part of the provisions.
However, the Mera boss said the tariff hike is just a proposal which the authority is required to analyse, and does not mean electricity will go up by over 90 percent.
Said Kachaje: “It is just a request. What they sent or want tariff to be raised by 90 percent, or whatever it is. It is just a wish that they have and they bring it to Mera.
“We scrutinise, we analyse it. By law we are required to publish what they have requested so that is the process that we took. We are required by law to publish.”
He said Mera will have to hear the public on the tariff application as required by the law, following which the regulator will review and make determination after interrogating all elements in the price build up.
Escom and PML have proposed a 99 percent tariff hike spread over five years, starting with an 80 percent increase this year.
The two firms say the current tariff structure is outdated and does not reflect the true cost of generating power.
The 2022-2026 electricity base tariff application the firms have submitted to Mera wants electricity tariffs hiked by 80.75 percent from the current K104 per kWh this year.
If Mera approves, the price of electricity could go up by K83.98 from K104 per kWh to K187.98 in the 2022-2023 year.
In the 2023-2024 year, the price could be adjusted to K184.18 per kWh while in the 2024 -2025 and 2025-2026 the price might go up to K210.59 per kWh and K249.15 per kWh respectively.
