Government considers reviewing utility tariffs |05 April 2023
Minister for Agriculture, Climate Change and Environment, Flavien Joubert, has stated that government is considering carrying out an exercise to revise the tariff of utilities.
He said this will be based on economic principles taking into account the impact on consumers and ensuring that the Public Utilities Corporation (PUC) recuperates enough to cover its operation and investment it would need to support the country’s development.
Minister Joubert made the statement in the National Assembly yesterday when outlining the current energy production and consumption in the country and PUC’s future plans.
“The revision of tariffs is important for the future of energy in the country but is a sensitive one based on the economic reality in the country,” said Minister Joubert, adding that the National Assembly and other partners will be informed when the announcement will be made so they can consult officials from his ministry and PUC.
“For big consumers tariff is established based on competition in the preparatory stage of the project but for smaller, especially domestic consumers, there should be a series of tariffs that are clear and transparent,” said the minister.
He informed the National Assembly that during the past twelve months – from April 2022 to April 2023 – there has been a significant reduction in electricity tariffs for all consumers and the latest announcement from the Energy Commission indicates that a 49 cent reduction will apply to all consumers.
According to Mr Joubert, it is predicted that demand in electricity will increase by 2.5 percent per year and “we expect that once the hotels in the western part of Mahé are connected during the 2023/2024 period there will be a significant increase in demand”.
He added that there will also be an increase in generation capacity which is predicted to be 20 percent for Mahé and 50 percent for Praslin. There were already plans to buy new generators to increase the capacity.
The Mminister also said that the exercise to review the tariffs will also take into consideration the tariffs that will be applicable for the purchase of renewable energy, including photovoltaic systems on the PUC network as well as rooftop systems.
“We expect that when the new tariffs come into force, this will further encourage more entities to invest in such systems, which will add on to the total thus helping the energy sector in the country.”
Minister Joubert said the government remains committed to providing energy but appealed to consumers to do their part by conserving energy at home and ensuring regular payments of their bills so that PUC can remain in operation and ensure energy security in the country.
Patsy Canaya