M a r k e t N e w s

Rwanda: Govt Slashes Power, Water Tariffs to Attract Industry Investors

Posted on : Wednesday, 14th December 2016

The Government has slashed unit prices for electricity and rural water supply by 50 and 30 per cent, respectively, a move officials say will help increase affordability, service efficiency and competitiveness, among others.

Effective January 1, 2017, electricity tariff for households that consume not more than 15 kilowatts per month, will be Rwf89, down from Rwf182, translating into a 51 per cent deduction from the standard cost.
On the other hand, people whose power consumption is between 15 kilowatts and 50 kilowatts per month, the price range has remained constant at Rwf182, while those with consumption beyond 50 kilowatts per month, the deduction will be from Rwf119 to Rwf112.
In the industry services, consumers with large industries will be paying Rwf83 per kilowatts, those with medium industries xRwf90 per kilowatts as the small industries will be paying a flat fee of Rwf126 per kilowatts.
According to Rwanda Utilities Regulatory Authority (RURA) , the changes in industry sector represent a decrease of 28 and 34 per cent depending on industry category.
"This will improve Rwanda's competitiveness particularly for investors in the industrial sector. I would like to say that the new tariff structure include the demand charge, which incentivises industrial customers to operate during off-peak hours between 11pm and 8am," Patrick Nyirishema, the director-general of RURA, told a news conference yesterday.
Water tariff
Similar decrease in prices will also apply to water supply system but in rural areas as the revised tariff for water consumption in urban areas will come into force mid-next year.
The new tariff for water will now range from Rwf10 to Rwf8 per one 20 litre jerrycan, for water systems using gravity, meaning water that is distributed without the need to pressure it with a pump.
There are at least 815 water systems in the country, of which, according to Nyirishema, the Water and Sanitation Corporation (WASAC) uses less than 10 systems.
The price of water pumped by electricity, for example, will effective next year be at Rwf20 per jerrycan having moved from Rwf30; while the price of water pumped through a more complex system (electricity, diesel and or Turbo) will be calculated at Rwf16 per jerrycan from the current Rwf20.
Nyirishema said the new tariffs for both electricity and rural water supply reflect the Government's policy of making social services accessible and affordable to the population, including the low income groups.
"These new tariffs aim at attracting foreign and domestic investments and promoting industrial development within the country," he said.
Local govts challenged on support
As the regulator plans to embark on an extensive awareness campaign on the new tariff structure, Nyirishema added that his office will rely more on the support of local governments, especially at the district level, where water management boards were set specifically to enforce the new strategies.
The move, according to officials, not only aligns with the country's commitment to extend potable water to every citizen, but it is also part of the recently adopted policy on water and sanitation.
Last week, Cabinet approved the proposed policies and strategies governing the sectors of water supply and sanitation, six years after the policies were tabled before the parliament and considered.
State Minister for Transport Alexis Nzahabwanimana said review of the policies aimed to harmonise with the recent structures in the water and energy sector.
"The changes were subsequent to the split of former Energy and Water Sanitation Authority (EWSA) into Rwanda Energy Group (REG) and Water and Sanitation Corporation (WASAC) as government sought to revitalise sector, making it more efficient and profitable at the same time," he said.
Minister Nzahabwanimana explained that changes in policy also seek to provide water to the citizenry at the rate of 100 per cent those in urban areas, while those in rural areas should be supplied at the rate of 80 per cent before year 2017.
Access to potable water for residents in rural areas should not be far from 200 metres from the current coverage area of 500 metres, Prime Minister Anastase Murekezi said while appearing before parliament early this year to present the status of the sector in the country.

Source : allafrica.com
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