The pain of tariff hikes
Thursday, April 09, 2015
The Botswana Power Corporation (BPC) received yet another tariff increase, with households set to pay between 7.5 and 10 percent more for electricity, a commodity that has become as scarce as it is costly.
Over the years, electricity tariffs for households have risen from 25.3 thebe per kilowatt-hour to 70 thebe before the latest increases. And they are still not cost reflective, meaning the Corporation makes a loss every time it supplies a single unit of power.
Whilst celebrating milestones in inclusivity, with notably P5 billion awarded to vulnerable groups, the report sounds a 'siren' on a dangerous and growing trend: the ballooning use of micro-procurement. That this method, designed for small-scale, efficient purchases, now accounts for a staggering 25% (P8 billion) of total procurement value is not a sign of agility, but a 'red flag'. The PPRA’s warning is unequivocal and must be...