This week the Chief Executive of Botswana Power Corporation told the media that going forward, as part of transformation the state owned power utility will shift focus away from generation and move more and more towards transmission and distribution.
Obviously this is a major and clear shift in policy direction by Government.
By taking away of some of the traditional roles of BPC, it is hoped will along the way, also lead completely to doing away with the corporation’s iron-clad monopoly.
So far it is too early to say just what the Government’s real intensions are.
What is clear from the presentation by the CEO is that BPC will shed a significant amount of its workforce.
That by the way is long overdue given that BPC was for a long time badly run, bloated and terribly inefficient.
Energy security is a big thing for Botswana’s economy.
It is in our interest ÔÇô all of us that BPC transformation does not get off into a tailspin.
BPC has an assured place at the top table of Botswana’s economy.
The parastatal is a very important cog in the big machine on whose shoulders rests the success or failures of the country’s economy.
Transformations are never easy. And their outcomes are never certain.
They often appear good on paper only to go pearshaped upon implementation.
On Monday, the BPC Chief Executive said the new BPC strategy will be implemented swiftly and according to pre-set timelines.
We take him at his word. And promise to hold him against it.
The strategy as announced by the CEO which has at its core the taking away from BPC the role and mandate of power generation has serious implications, that unfortunately have up to now not been spelled out to the consumer.
To be fair, that is not the responsibility of BPC ÔÇô not it’s Board and certainly not its management.
Rather that is the responsibility of policy makers at Government levels.
Government should be honest enough to tell the public to brace for high electricity tariffs in the next twelve months and beyond.
This will be made worse by the fact that Morupule B, a cornerstone of Botswana’s future energy security is as we speak under negotiation to be sold out of the BPC balance sheet.
Government might still try to continue subsidizing power after the sale of Morupule B, and when BPC is now a distributor and not a generator.
Government subsidies, in this era of lean economic forecasts can never be expected to substitute for hardnosed private sector price driven profits.
In other words, no matter how hard the government might try, such subsidies will prove much more problematic in that whoever wants to buy Morupule B would only do so depending not on the Government undertaking to pump subsidies, but rather on the straight and narrow business case.
More to the point, once Morupule B has been sold, the new owner will naturally strive to maximize profits in the manner that BPC could never have dreamt of.
For all the ensuing uncertainty, credit must be given to Government for taking a bold step to liberalise the generation of electricity in the country.
Taking away the generation role from BPC has been a bold but necessary step.
It will with time prove not to be the only step needed to turn around the industry.
The separation of roles will hopefully make BPC leaner and more efficient.
More importantly the ongoing transformation, if properly carried out has the potential to not only save BPC but also reform the entire energy sector in Botswana and bring it to the footing of the direction where rest of the world is headed.
