Africa-Press – Namibia. THE Electricity Control Board (ECB) is at an advanced stage with plans to establish an electricity distribution company which would operate in the central parts of the country, covering the Khomas region and Rehoboth.
ECB acting chief executive officer Pinehas Mutota confirmed these plans to The Namibian yesterday. However, Windhoek mayor Job Amupanda is opposed to the plans, saying it would increase the cost of electricity for residents, and in turn cripple the municipality’s already strained revenue streams.
Mutota said preliminary consultations on this project started last year and are ongoing. These consultations would approve the governance model of the company and address the concerns of stakeholders, including the Windhoek municipality.
“As currently demarcated, Windhoek falls in the Central RED [Regional Electricity Distributor] areas, and Rehoboth under Sored [Southern Electricity Distribution Company]. The establishment of Sored is at an advanced stage, with the approval of the agreements establishing Sored awaiting the attorney general’s inputs and approval,” he said.
There are three regional electricity distribution companies in Namibia so far, namely the Northern Regional Electricity Distributor (Nored), the Central Regional Electricity Distributor (Cenored), and the Erongo Regional Electricity Distirbutor (Erongored).
The concept of consolidating the distribution industry was developed to address the many deficiencies found in the fragmented electricity sector, such as a lack of revenue collection management.
According to Mutota, local authorities and regional councils without electricity distribution companies owe NamPower about N$400 million in bulk electricity supply costs.
The concept of a RED is also intended to solve other problems, such as a lack of proper infrastructure maintenance, inadequate investment in infrastructure, and poor planning and a lack of sufficient skills and equipment.
Amupanda, who criticised the plan on social media, said the ECB’s sudden move to establish the distribution company seems politically motivated. He claimed the motive behind the establishment of the RED is to cripple the Windhoek municipality’s income.
“Of primary concern is the impact this would have on the city’s operation, because electricity contributes more than N$1,8 billion to the total revenue of the city. The strategy is to collapse that revenue stream so that we are unable to control the expenditure.
“The city would have no choice but to increase rates and taxes, and the residents would be angry with the leadership of the city,” he said.
During the current financial year, the city’s expenditure is estimated to be N$4,9 billion, and its income N$4,6 billion. The two biggest expenses of the municipality are employee costs of N$1,5 billion, and electricity purchases of N$1,5 billion.
Mutota said Windhoek’s residents would receive focused and improved service delivery from the entity, with the main aim to distribute electricity in an efficient and effective manner.
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