Windhoek on Red Carpet for Overcharging


By Petronella Sibeene WINDHOEK Residents of Windhoek could receive refunds collectively amounting to more than N$6 million after it emerged the municipality has been overcharging consumers for electricity supply. This development results from recent findings that the city sent out inflated power bills in excess of N$6 million over the past two months. The Electricity Control Board (ECB) has indicated its intentions to engage in discussions with the City of Windhoek with the main objective to review the current municipality tariffs on electricity that are reportedly unlawful. The ECB recently received complaints from several concerned parties alleging the municipality collects millions of dollars from its customers by using a non-approved tariff schedule. Based on this, the ECB last week sent a letter to the Windhoek City Council requesting an urgent meeting that will specifically look into these allegations. ECB Chief Executive Officer Siseho Simasiku yesterday confirmed that his office has received complaints alleging that the City of Windhoek has for the past two months been draining its customers’ pockets. “We are concerned about this and if it is found that the City of Windhoek is overcharging, we would want to know why because for the past five years we have been working together,” said Simasiku. It is also alleged that apart from the collected millions every month, the City has also been charging a 0.5 cents levy for electricity while the ECB’s approved levy is 0.45 cents. This every month adds up to N$25 000 extra. The other unlawful step undertaken by the City involves the capital needed to start up the Central Regional Electricity Distributor (RED) project. According to the ECB, every RED as an entity has to find ways of building up its equity mainly generated from its capital before it becomes functional. The City instead imposed this responsibility on its customers who are now paying one cent on every unit of electricity. Should the main electricity supplier in the capital be found guilty on the allegations or to have gone against the Electricity Act of 2000, Simasiku says the Windhoek City Council will be taken to court to explain its illegal act. It is not yet known when the two entities would engage in discussions but according to the ECB, in its letter to the chief executive officer of the municipality, the matter is of urgency and should be treated as such. While Section 25 of the Electricity Act 2000 stipulates “a licensee may not levy any charge against any customer other than in accordance with the tariffs specified in the schedule of approved tariffs contained in the licensee’s license,” the City will in addition to compensating its customers pay an N$8 000 penalty fee. Since July 2006, the City is alleged to be collecting about N$3 million from customers. Despite the ECB approving an average increase for the City of Windhoek of 10.2 percent in June this year, customers have been charged seven percent (7%) more than the approved schedule of tariffs. “The ECB regards the charging of unapproved tariffs as a serious transgression of the Electricity Act,” Simasiku said. The ECB assured the public of its commitment to ensure that customers are charged reasonable tariffs for their electricity and that the electricity legislation is being complied with. Meanwhile, the City declined to comment on the matter with its public relations officer Elizabeth Sibindi stating, “We would not want to pre-empt anything at the moment.” She could also not tell when the municipality will respond to the letter from the ECB. The Chief Executive Officer of the Namibian Manufacturers Association (NMA) Hennie Fourie in a statement verified that the municipality is overcharging its customers. This fact, according to Fourie, was ascertained by the NMA when investigating whether an agreement by the authorities to level the rates applicable to domestic and industrial users in the capital was being adhered to. The ECB-approved rate for normal manufacturers is 34.05 cents per unit plus 0.45 cents ECB levy which totals 34.5 cents per unit. The municipality currently charges 37.5 cents per unit plus 0.5 cents ECB levy which totals 38 cents per unit. This constitutes an overcharge of 3.5 cents per unit. A report compiled by a NMA consultant indicates manufacturers in Namibia pay 60% to 70% more for electricity compared to South Africa.