This week the leadership of BERA (Botswana Energy Regulatory Authority), which is an independent regulator for the energy sector held its first media conference to outline its mandate to the press. BERA was represented by both the Board and indeed the top executive management. It was an exceedingly useful event in as so far as it went at length to prove in detail just how overdue the creation of the Authority is. Yet in a totally unintended way, the press conference also went at length to expose the limited regulatory powers of BERA as contained in its founding statute. BERA powers for example will only go as far as power generation. Distribution and transmission are out of reach for the new body. This effectively means that a great majority of the monopoly that is Botswana power Corporation will remain untouched by BERA. The law creating BERA has been totally watered down and shorn of powers that are necessary.
The end result is that what was supposed to be an Authority that was needed to overhaul and transform the country’s energy sector will find itself in many instances against the entrenched powers of the BPC. It would seem like Government decision to create BERA was not only half-hearted but also begrudged, possibly as a way to placate those who for years had been calling for the establishment of such an organization as a way of stimulating the energy sector chiefly by releasing it from the shackles and monolithic clutches of BPC monopoly. For those who had long clamoured for the establishment of an energy regulatory authority, BERA will come as both a relief, but also a disappointment. As a result of these limitations, calls for breaking the BPC monopoly will continue ÔÇô afterall that has always been part of the raison d’├¬tre.
Admittedly, the creation of BERA is a welcome step. And the Authority will go a long way in infusing some level of competition, liberalization of the energy sector and indeed stimulating new investments and also the overall economy. But those positive outcomes will in no way match the optimal potential that would otherwise come to bear had Government and Parliament gone full length to create an Authority that had far reaching powers. We can only hope that the operational regulations will attempt to address this statutory disability. The importance of power as a strategic asset has often been mentioned as a reason why Government could not give away all powers incumbent in the energy sector. In a way that is correct, but only up to a point.
But still we want to argue that the overriding concern for coming up with a regulatory authority should have been above politics. Energy security, reliability and economic efficiencies are important, but so too should be achieving lowest prices for consumers which cannot be achieved unless the BPC monopoly is totally broken down and dismantled. As has always been the case, it is our firm view that the economy of Botswana would be best served by a complete liberalisation of the energy sector. Having said that, this newspaper nevertheless calls on BERA to do the best under the circumstances. Opening up the energy sector, levelling the playing field and enhancing competition have the potential to attract new players and investors into this sector. When the economy is stimulated, the ultimate beneficiary will be the consumer.
Rising power prices are a huge political issue, especially in Botswana where many people are unemployed, or when they are employed find themselves in the low level income. The other political dynamic is that electricity in Botswana is that power in this country is highly subsidized. This makes the subject as explosive as it is volatile.
