ENERGY MINISTER: We are working on curbing skyrocketing electricity tariffs

Energy and Mineral Development Minister Mary Goretti Kitutu has assured the country that her ministry is working with the Electricity Regulatory Authority (ERA) to resolve the issue of fluctuating tariffs for electricity consumers.

The Minister told the Members of Parliament on the Committee on Natural Resources today that she has already tasked ERA to provide an explanation after her Ministry received complaints from different parts of the country.

“It is not Umeme that determines the tariff rates but it is the regulator. I have written to the regulator to provide clear information and I will present it on the floor of Parliament,” the Minister stated.

The Ministry of Energy officials were appearing before the Committee on Natural Resources to defend the UGX1.057 trillion budget for the financial year 2021/2022.

Electricity tariff is the amount of money framed by the supplier of the electricity energy to various types of consumers. In Uganda, the consumers are categorized as; domestic, commercial, medium industrial, large industrial and extra-large industrial.

However, the current outcry over the unstable tariffs is being suffered by mostly the domestic consumers who have raised a red flag challenging non uniform payment. The matter has been brought to the attention of Members of Parliament who sit on the Committee on Natural Resources.   

There have been concerns that domestic consumers are receiving varying units per amount of money paid to Umeme Limited through the digital system called Yaka. This is a pre-paid system where consumers purchase electricity before consuming it.

Bukomansimbi North Member of Parliament Ruth Katushabe has tasked Minister Kitutu to explain why Ugandans continue to receive different units for the same amount of money paid after they exhausted the previous ones. She said that Ugandans are worried that they could soon begin paying more and receive less in terms of units of power purchased.

“The people complaining about the units they receive on payment for Yaka is confusing. People pay the same amount and get different units. But also the cost of a unity of electricity on Yaka is going up. What is causing this?” Katushabe asked.

The Minister declined to reveal the details of the report she has received from ERA to the Committee because it would be a preemption of the statement expected on the floor of Parliament before the end of the month.

Mr Robert Kasande, the Permanent Secretary in the Ministry of Energy pleaded with MPs to allow the statement to be presented to the whole House so that all legislators are able to receive the information at once.

Ruhinda North MP Thomas Tayebwa also weighed in on the outstanding concern on the continuous charging of monthly service fee by Umeme on consumers.

“You also need to deal with the issue of service fee charge every month. You charge people a service fee for the months they have not used the electricity. You are penalizing people even when there is load shedding. Is this monthly service charge necessary even when the telecoms removed it” said Tayebwa.

Currently, Umeme charges a Standard Service Fee of UGX3,360 as set by Electricity Regulatory Authority (ERA). If you don’t purchase units for a number of months, Service fee accumulates and is recovered from your next purchase.

REA budget

Meanwhile the UGX261.8b budget for the Rural Electrification Agency (REA) hangs in balance as the MPs and the Ministry officials failed to agree on appropriating money to an entity that seems to be non-existent going forward.

The MPs demanded to review guidance from both the Cabinet and by the Attorney General on disbanding REA to make it become a department in the Ministry of Energy.

Kitutu said REA was created by instrument 75 of 2001 after the enactment of the Electricity Act, 1999. She said that this instrument was replaced by instrument number 62 which has since been quashed by Court.

“As we speak now, I think we need clarification from the Attorney General because the current guidance he gave to the government is that there is no instrument. When we were preparing the ministerial policy statement, the merger (of government agencies) came in and now we are working on the guidance of Cabinet” the Minister revealed.

But the MPs were concerned on how they would appropriate funds to a vote whose entity has already been charged into a department of the Ministry.

“There is a vote and the Accounting Officer is not going anywhere. REA can still receive its funds because the fund is managed by the Electricity Act. The Minister created an instrument that manages the fund and Cabinet has guided that we merge the agencies” said Kasande, the Permanent Secretary.

Cabinet approved a decision to merge most of the agencies and make them departments in the relevant ministries in order to ensure efficiency and the process will be concluded in the next two years by the Ministry of Public Service.

The Committee on Natural Resources was this afternoon expected to retreat to work on a report in order to meet the timelines given ahead of reporting to the budget Committee tomorrow.

Kiboga County MP Kefa Kiwanuka who chairs the committee expressed concern that they may not manage to provide funds to REA before seeing written evidence of the Cabinet directive on dismantling the agency.