Malawi electricity tariffs up again

Malawians will continue dipping deeper in their pockets to pay for electricity as Malawi Energy Regulatory Authority (Mera) has effected a tariff hike to K57.07 (about $0.10) from the current K53.69 (about $0.08) per kilowatt-hour.

This raise represents a 7. 5 percent according to the energy regulator.

According to a statement signed by Mera board chairperson Dingiswayo Jere, Mera approved the hike following a review of Electricity Supply Corporation of Malawi (Escom) tariff through the Automatic Tariff Adjustment Formula.

Jere said after considering the impact of inflation rate and exchange rate movement the electricity tariff qualified for an upward adjustment.

Jere explained the tariff was beyond the statutory plus or minus five percent threshold for revising tariffs

“Applying the February 2016 exchange rate and inflation figures on the ATAF, resulted into a 15.64 percent upward electricity tariffs adjustment.

“According the principal of ATAF, the outcome of 15.64 percent is beyond the statutory more or less 5 percent trigger limit of adjusting electricity tariffs to cover the erosion of the electricity tariff due to depreciation of the Kwacha and rising inflation,” reads the statement in part by Jere.

Economics Association of Malawi (Ecama) executive director Edward Chilima predicted that electricity tariffs were set to be raised owing to the sharp weakening of the kwacha and rising inflation.

He, however, urged Escom to embrace the public sector reforms that are currently being championed by government, observing that there are a number of inefficiencies in the management of parastatals.

Similarly, Consumers Association of Malawi (Cama) executive director John Kapito queried Escom that it has failed in most of the key performance indicators necessitating further power hike.

In Malawi, electricity tariffs are expected to be reviewed every four years and since 2008, there have been two electricity tariff reviews, the first being from 2009 to 2013 and the second from 2014 to 2017.