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Power tariff increases insensitive


SX 01IT never rains but pours for consumers following Friday’s announcement of a new round of power tariff increases by the Lesotho Electricity and Water Authority (LEWA).

The pronouncement, which increases electricity charges by between 11.8 percent and 12.4 percent beginning May 1, could not have come at a worse time for the already overburdened consumer.
With fuel prices consistently going up over recent years, businesses have been forced to pass on the costs triggered by the increases to the hapless customer, thereby pushing the prices of most basic commodities beyond the reach of many.

A country where three full meals a day for every family was never an exception but the norm, Lesotho has, however, increasingly become a very difficult place to live in for most ordinary citizens due to the ever-escalating cost of basic necessities.
It has since become normal for most families to have one meal a day due to the unaffordability of basic commodities such as maize-meal, while the majority of employees have now resorted to walking to and from work because they can no longer afford the taxi fares.

As if their woes are not enough, LEWA goes on to drop a bombshell, which puts further strain on consumers’ budgets.
The utility has, however, explained why it granted the Lesotho Electricity Company (LEC) the increase, which is almost double last year’s hike.

The reasons are not entirely without merit, and as explained by the organisation’s chairperson Francina Moloi, the increases would help the LEC realise the requisite growth while also improving service-delivery. In-fact, the LEC had asked for a 26.8 percent tariff increase in order to generate the required revenue of M778.1 million, which, fortunately for consumers, was turned down by LEWA.

Yet an increase of 12.1 percent for domestic customers is still too steep for a commodity that should be afforded by every single citizen of the country, the same way every Mosotho should have access to potable water.
The power-utility has said the new charges were reached at after evaluating input from various stakeholders such as the Consumer Protection Association, Lesotho Chamber of Commerce and Industry, Transformation Resource Centre, Forum of Electrical Practitioners Industry, Catholic Commission for Justice and Peace, as well as ordinary members of society, which suggests it consulted widely in reaching these new charges.

But in a country like Lesotho, where unemployment continues to rise and companies have since stopped increasing workers’ salaries — for the lucky few fortunate enough to be still holding on to their jobs — organisations in which government has a majority stake such as LEWA, should be heavily subsidised to ensure they don’t end up disenfranchising the people.
LEWA’s mission — as indicated on its website — is to be a world-class utilities regulator that facilitates delivery of affordable, sustainable and quality services.

But after the latest round of electricity tariff increases beg the question of if the authority is still cognisant of this mission statement, particularly regarding affordability.

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