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Water, electricity tariffs go up

BPC and WUC are making losses due to low tariffs
The government will increase potable water tariffs by an average of 20% in April this year whilst a 12% power tariffs jump has been proposed, Mmegi Business has learnt.

Land Management, Water and Sanitation Services minister, Prince Maele told Parliament on Monday that potable water tariffs will increase by 25% for government and 15% for domestic and business effective from April 1, 2017.

The last time the government reviewed water tariffs was in 2013 when they were increased by 15%, following an increase of 10% in 2012.

According to the minister, while water tariffs were reviewed two times since 2008, potable water connection fees were reviewed once in 2015.

He noted that currently, the Water Utilities Corporation (WUC) provides water at a standard rate up to 50 metres for P2,000, which includes the corporation digging the trenches and P1,500 where the customers dig trenches for themselves.

“This is an increase from the original P840 with no option of self-trenching,” Maele said.

Late last year, WUC chief executive officer, Mmetla Masire told a Parliamentary committee that the utility needed tariff subsidy of P350 million annually.

Since 2009, WUC started experiencing financial troubles as its finances slumped into crisis in recent years as a result of added responsibilities

under the Water Sector Reform Programme, when it took over the supply of water to all urban centres and villages.

Meanwhile, the acting minister of Mineral Resources, Green Technology and Energy Security, Nonofo Molefhi also indicated that the Botswana Power Corporation (BPC) has applied for an average 12% increase in electricity tariffs.

Responding in Parliament, Molefhi said the proposal was under consideration.

 Should government grant the request, the tariffs will be hiked with effect from April 1.

In recent years, the BPC has become totally reliant on government subsidies, and has been allocated P1.46 billion as an operational subsidy for 2017/18 financial year.

Finance minister, Kenneth Matambo told legislators during the Budget Speech that foregoing the subsidy would result in higher tariffs.

For the financial year ended March 2015, the BPC received a subsidy of P2.33 billion and another of P2.32 billion for the year ended March 2016.

For the year ending March 2017, the BPC was allocated P1.35 billion in February 2016 and received an additional P1.3 billion in a supplementary budget in December.




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