DAR ES SALAAM, Tanzania – The ongoing power woe coupled with the Tanzania Electricity Supply Company (Tanesco) plan to raise power tariffs by 67.87 per cent has paralyzed businesses around the country.Business communities have now teamed up with Tanzanians to express disapproval of the state owned power utility plan to hike the power tariff. They first demand for the better service before the deal.
They said at first, the power utility has raised the power tariff by 40 per cent with an expectation that things will change and they will start being given better services but unfortunately the power blackout kept on increasing.
The traders condemned consistent tariff hikes which are contrary to the service which the state owned power utility has been offered to them. They proposed to the government to invite private firms to compete with Tanesco in power generation and distribution.
“We have incurred an operational cost twice a year, first through the 40 per cent power hike early this year and now via power rationing,” said Mr. Athumani Mwangosi, one of the traders at Kariakoo, the busiest market area in Dar es Salaam.
The soft drinks dealer, who is also running a number of restaurants around the city, said that he has been using generator since the power woe started but bad enough, he receives another report that he has to dig more from his pocked for power.
Tanesco were awarded a 40 per cent tariff increase early this year; however the electricity supply remained inconsistent, especially in most of the business areas. This has been forced traders to use generators or close their businesses.
“It’s very embarrassing to see the power cuts without prior notice, this has caused an extra cost in running our business,” Sadick Manoza said, who is also doing his business at the Kariakoo’s busiest and most thrilling market.
Most of the private sector businesses rely on consistent power supply for production, said Mr. Juma Hamisi, a trader who run a textile industry in Dar es Salaam, adding that with interrupted power, ‘we produce below our target.”
“Besides under production, but also we incur an extra cost, hence we gain huge loss…so what next if the Tanesco’s proposal will be approved,” he noted.
Tanesco is seeking to increase the current electric tariff of 197.81 per unit to 332.06 per unit, an increase of 67.87%.
Early this year, the Energy and Water Regulatory Authority (EWURA) granted the power utility company a 40 per cent increase of tariff less than six months of assessment, when it sought to increase the tariffs by 155 per cent.
The power utility is seeking to hike the current power tariff to the period whereby most businesses have been paralyzed due to power woes. It said that it needs the money so as to smarten up its networking but also to facilitate its running costs.
The traders’ crying come since the state owned power utility announced power rationing for 17 days so as to pave ways to maintenance the interrupted gas field at the Songo Songo gas field.
The interrupted gas field which caused the shortage of power has hit most of the business areas in Dar es Salaam and the upcountry. The natural gas at gas plant produces about 234MW of power to the national grid.
Gas accounts for between 40 to 45 per cent of electricity generation in the country as hydro power and diesel-fired turbines generate the rest.
The power utility’s Managing Director, Eng. Felschesmi Mramba confirmed to East African Business Week that the power woe will be eased as the maintenance of gas wells at the Songo Songo gas field is on good progress.
“The maintenance at the gas fields was in its final stages, he said, adding that we are pushing operators of the facility to ensure that the maintenance is completed on time.”
Economists believe that frequent increase of tariffs will not solve the problem that Tanesco is now facing. They said the higher tariff means higher inflation as a result common people will suffer due to high cost of living.
They added energy sector needs some additional seriousness rather than tariff increase shortcuts.
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