CAMA Challenges ESCOM's 69.7% Tariff Hike, Seeking Transparency

The proposed 69.7% electricity tariff hike by ESCOM in Malawi is challenged by CAMA. Learn about the reasons behind the adjustment, CAMA's concerns, and the ongoing discussions surrounding this issue. Find out how this potential increase could impact electricity consumers in Malawi.

CAMA Challenges ESCOM's 69.7% Tariff Hike, Seeking Transparency

The proposed 69.7 percent electricity tariff hike by the Electricity Supply Corporation of Malawi (ESCOM) has come under scrutiny from the Consumers Association of Malawi (CAMA). John Kapito, the Executive Director of CAMA, has urged ESCOM to provide a clear explanation for this significant increase. In this article, we explore the reasons behind the proposed tariff adjustment, CAMA's concerns, and the ongoing discussions surrounding this issue.

ESCOM is currently proposing a 69.7 percent electricity tariff adjustment, aiming to bolster its daily operations, as stated by Maxwell Mulimakwenda, the Chief Operations Officer. To ensure a smoother transition, the adjustment will be implemented gradually over the course of the next four years, rather than all at once. Mulimakwenda emphasized that this tariff adjustment will address the issue of frequent blackouts by enabling ESCOM to purchase an ample supply of power from various producers, including the Mozambican government.

In contrast, John Kapito of CAMA has expressed dissent, perceiving the proposed 69.7 percent tariff adjustment as an excessive burden on the people of Malawi. Kapito's argument is grounded in ESCOM's previous failed tariff adjustment proposal in 2018. He seeks assurance that the promises made by ESCOM this time will indeed be fulfilled. Kapito urges stakeholders and citizens to reject the proposed increase, asserting that it will not benefit consumers. If any increase is warranted, Kapito suggests it should not surpass 46 percent

Kapito directs his criticism towards EGENCO, holding the institution accountable for contributing to the exorbitant proposed tariff adjustment. He asserts that dissolving EGENCO would reduce expenses and alleviate the financial strain on Malawians caused by high electricity tariffs. Kapito proposes consolidating institutions into a single entity, resulting in cost reduction and increased efficiency. He suggests that EGENCO lacks value and advocates for the creation of departments within a unified institution.

Henry Kachaje, the Chief Executive Officer of the Malawi Energy Regulatory Authority (MERA), has scheduled public engagements in Lilongwe and Mzuzu to gather recommendations and opinions on the tariff increase proposal. MERA will consider the feedback from these sessions to make an informed decision. If approved, the proposed tariff adjustment will result in electricity consumers paying an average of K177.26 per kilowatt-hour (kWh), a significant increase from the current average of K104.46/kWh.

The proposed 69.7 percent tariff hike by ESCOM has elicited concerns from CAMA, led by John Kapito. While ESCOM argues that the adjustment is necessary to improve operations and eliminate blackouts, Kapito questions the feasibility of ESCOM's promises based on their past performance. The ongoing discussions, including public engagements hosted by MERA, will help determine the fate of the proposed tariff increase, which could have a substantial impact on electricity consumers in Malawi.