Saturday, February 27, 2021

Time to liberalise energy sector and cut BPC’s over-weaning power

Latest glitches in power supplies highlight more than ever the pervasive risks of relying just on the Botswana Power Corporation for the country’s energy supply and needs.

BPC, we all now know has terribly mismanaged the energy supply expansion through the now ill-fated Morupule B; a multi-billion pula investment that has somewhat disappeared down the bottom of the leaking bucket.

For almost six years now the country has been promised the change of law to effectively do away with the BPC monopoly.

Almost five years to the day, the then Minister of Energy, now Vice President Ponatshego Kedikilwe talked of liberalising energy supply by allowing Independent Power Providers.

IPPs will not only bring competition, they will also alleviate the now constant power outages and help bring down prices.
Most crucially, Independent power Providers will not be supported by public money such as is the case with BPC.

All that such suppliers will need is a legal guarantee that they will be allowed access into the national grid, especially during times like that we are today going through when BPC is itself not able to provide constant much less predictable supply.

With close to 90 percent of BPC ferried electricity imported from South Africa, providing such a guarantee should not be the most difficult thing on earth, least of all today when the South Africans themselves have time after time advised us to look elsewhere they are now unable to provide guaranteed supplies in their own backyard.

As it is tariffs are very high because by and large BPC sells a commodity that is not able to produce.

Because the BPC is nothing more than a middle man, prices have to be reasonably higher because the source, in this instance South African ESKOM, needs to make margins from its product, while BPC also feels entitled to something else.

The end result is that as Batswana we are stuck with a middle man who is protected by law against the consumers going directly to the supplier.

There is also a long overdue need for an independent and properly constituted energy sector regulator with clear legal backing.
We appreciate what the Department of Energy has been doing over the years.

But the sector has become much more sophisticated, much bigger, and more complex ÔÇô attracting all sorts of characters that have not just expertise but also not the cleanest of motives that need to be restricted.

Unless an independent regulator is established, in no time the credibility of the Department of Energy Affairs will be on line ÔÇô that is if it is not already.

We are now living in an age where BPC tariffs are unchecked, unverifiable and we suspect, left to fate as the regulator is now drowning ÔÇô for want of a better word.

The Department of Energy has neither the appetite nor the expertise and capacity to enforce the rules.

Because it has so few engineers it finds itself relying on BPC engineers for advise including policing and regulating themselves.
The result is a runaway BPC that is allowed to do as it pleases including mismanaging of billions of Pula at Morupule B, money that we have to keep reminding everybody has to be repaid as it was debt-financed, with Botswana Government as the ultimate guarantor.

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