Electricity tariffs reduce-  ERA announces

Business

Electricity Regulatory Authority (ERA) has announced that starting January, electricity tariffs for most categories of consumers will reduce.

Addressing journalists on Friday, ERA chairperson, Dr.Sarah Kanaabi Wasagali announced that for the first quarter of the new year which runs between January and March, there will a  1.2% reduction in the power tariffs.

“For commercial users, there will be a 2.1% reduction, whereas medium industrial consumers will have a 2.1% reduction, 0.6% reduction for large industrial users, and the same percentage(0.6%) for extra-large industrial users to make it 1.2% on average,”Dr.Wasagali said.

Breaking down the reduction in electricity  tariff, she explained that it will move from shs482.3 per kilowatt hour (kWh) to shs472.3 whereas  large industrial consumers who have been paying shs388.5 per kilowatt hour will now pay shs386.3 whereas extra-large industrial consumers will move from shs328.5 per kilowatt hour to 326.6.

However, the tariff for street lights that has been at shs370.0 per kilowatt hour will not change.

According to the new tariffs, there will not be any change for domestic consumers for the lifeline tariff which will remain at shs250.0 per kilowatt hour but there will be a 1.5% reduction from shs820.9 to shs808.9 per kilowatt hour.

The ERA chairperson explained that the new tariffs were arrived at after taking into consideration the 1.9% appreciation of the Uganda shilling against the dollar from shillings 3810.74 per dollar used in the determination of the retail tariffs for the fourth quarter of 2022 to shs3738.33 per dollar as of November, 30.

“With effect from April 2023, UEGCL will assume the operations of the Nalubaale and Kira power dams and electricity demand is expected to grow at an annual rate of approximately 8.31% in 2023,”Dr.Wasagali said.

She noted that because government will now take over the two power dams, it will not be looking at making profits and this will mean the tariffs go down.

ERA explained that they will commence the implementation of the $5cent industrial tariff for extra-large industrial consumers which will increase the uptake of electricity and production.

The Energy Minister, Ruth Nankabirwa described the development as a positive trend towards the growth of the country.

“The 1.2% reduction in electricity tariff is something to congratulate ourselves about and slowly but steadily, we shall reach the desired destination,”Nankabirwa said.

Whereas many say the 1.2% reduction might look small, the minister defended the figure as being significant.

“A reduction is a reduction. It is never small. As government, we sell 1300megawatts and the 1.2% means we have reduced money in billions and billions. For people who consume power in bulk, the 1.2% reduction is a lot. If you are not consuming in bulk you may not feel it. This is a very significant deduction for government,” Nankabirwa said.

 

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