The Namibian government, through the Electricity Control Board (ECB), has approved a moderate 3.8% increase in electricity tariffs proposed by NamPower, the country’s state-owned power utility, rejecting the company’s initial request for a 17.44% hike. The measure aims to protect consumers while maintaining the sector’s sustainability.
NamPower had sought to raise the average tariff by 17.44%, citing rising operational and infrastructure costs. Following financial audits, stakeholder consultations, and technical analysis, the ECB reassessed NamPower’s revenue needs. In response, the government granted financial support of 15.9 million US dollars to offset the shortfall.
The decision was influenced by an over-recovery of 54.2 million dollars in the 2023–24 fiscal year, driven by high output from the Ruacana hydroelectric power station, which eased pressure on consumers. The ECB also noted that even moderate tariff increases could impact GDP growth, but warned that failing to implement periodic adjustments could lead to infrastructure deterioration, blackouts, and loss of investor confidence.
“The ECB sought a careful balance between price affordability and the need for sustainable investment in the country’s energy sector,” said the regulator’s chairman, Robert Kahimise.
The new tariffs will take effect in July this year. Though lower than the current inflation rate, which stands at 4.2%, the tariffs are considered essential to ensuring reliable energy supply and supporting Namibia’s economic development.
Source: Further Africa
