Cama takes Mera, Escom to court over tariff hikes

The country's consumer watchdog, Consumers Association of Malawi (Cama) has taken to court Malawi Energy Regulatory Authority (Mera) and Electricity Supply Corporation of Malawi (Escom) over recent electricity tariffs hike. [caption id="attachment_100920" align="alignright" width="538"] Jere: Mera announced electricity tarrif hike[/caption] [caption id="attachment_100919" align="alignright" width="494"] Kapito: Against the proposed hike in electricity tariff[/caption] Mera Board in December resolved that electricity tariffs be increased by 6.6 percent- to K53.69 (about $0.08) from K40.69 (about $0.06) per kilowatt-hour. The increase came barely a month after the energy regulator gave Escom a 13.7 percent increase in tariffs. But on 31st December, 2015 Cama through its lawyers filed a lawsuit against the two institutions, challenging their decision to hike the electricity tariffs despite Escom's poor performance. According to the Summons issued by Chief Justice Andrew Nyirenda, Escom and Mera have been given 14 days to respond to Cama's lawsuit or suffer default judgment. Cama's Executive Director, John Kapito told Nyasa Times they are seeking a court injuction stopping the tariff increase until the decision is reviewed. ''We are seeking an injunction before any tariffs increase in order for the two bodies (Mera and Escom) to explain to Malawians the reasons behind the current tariff increases that do not make sense to the ordinary Malawian,'' Kapito said. Kapito argued that the tariffs increase was inconsiderate to the consumers especially at a time when the country is unable to get any power supply from Escom due to continued blackouts. ''There is need for Mera and Escom to engage consumers on the justification for this tariff and we are also aware that Escom has consistently failed to meet its own Key Performance Indicators (KIPs)and why are they being rewarded for that failure,'' further argued Kapito. The lawsuit will surely please many consumers who are being overburdened by the sharp increase in the cost of living as the country's economy is on downturn. In December, Mera Board Chairperson Dingiswayo Jere defended the tariff increase, saying Mera approved the hike after considering the impact of inflation rate and exchange rate movement. ''The tariff which was beyond the statutory plus or minus five percent threshold for revising tariffs and therefore the electricity tariff qualified for an upward adjustment,” said Jere. But Kapito queried Mera’s approval for a tariff hike, saying Escom failed in most of the KIPs necessitating further power hike. Escom generates 351 megawatts of electricity which does not meet the country's demand. In Malawi, electricity tariffs are reviewed in every four years and since 2008 when Mera Board was elected, there have been two electricity tariff reviews, the first being from 2009 to 2013 and the second of 37.28 percent from 2014 to 2017.