The Observer (Kampala)

15 January 2014

Uganda: ERA Reduces Power Tariffs

For the first quarter of 2014, power users will pay a little less in tariffs for the units they will consume, Electricity Regulatory Authority (ERA) announced yesterday.

Addressing journalists at the media centre, ERA Chairman Richard Santo Apire said prevailing conditions warranted the decrease in charges, in consumer categories. Tariffs for domestic power fall from Shs 524.5 to Shs 520.4; while the commercial consumer tariff drop to Shs 477.4, from Shs 487.6. Medium industries will also pay Shs 452, down from Shs 458.9, while the large industries will pay Shs 310.4 from Shs 312.8.

The tariffs for street lights stayed at Shs 488.8 per unit. The first 15 units charge remains at Shs 150.

"There was a favourable exchange rate regime where the Uganda Shilling appreciated from Shs 2,688 per dollar in 2013 to Shs 2,524 in 2014," Apire said.

Apire added that power distributor Umeme had reduced power losses from 23 per cent last year to 20 per cent this year. In 2012, ERA increased power tariffs by close to 40 per cent citing government removal of subsidies - triggering a public outcry.

The new tariffs, however, are subject to a quarterly review, says Mutambi, and could change on the exchange rate of the shilling against the dollar. If the shilling continues to appreciate, it becomes less costly for the power firms because they will need fewer shillings to buy the dollar to import equipment or send to their mother countries, hence limited push for tariffs increment.

Mutambi added: "changes in global oil prices will very much determine how the tariff will look like after the next six months."

Power generation companies use fuel in their operations."

The junior minister for Energy, Peter Lokeris, said government had set strong terms for the power companies. For instance, he said, the firms are required to reduce power losses to 14.8 per cent by 2018.

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