MERA BOARD RESOLUTION ON THE ESCOM BASE TARIFF APPLICATION FOR THE PERIOD 2018 TO 2022

BACKGROUND

The Malawi Energy Regulatory Authority (MERA) received an application for the third base tariff from Electricity Supply Corporation of Malawi (ESCOM) on 20th April 2018. The proposed electricity base tariff was for the period 2018 to 2022. ESCOM made the application following the conclusion of its implementation of the second base tariff in June 2018 which covered the period 2014 to 2018.

This third base tariff application was unique as it was prepared on the basis of the unbundled ESCOM comprising business units of Transmission, Distribution, Single Buyer, System Market Operator as the building blocks to the overall tariff to be paid by electricity users. The charge from the Electricity Generation Company (Malawi) Limited (EGENCO) has in the new framework been accounted for as a power procurement cost to ESCOM.

ESCOM applied for a 60% third base tariff increase covering all the business units which would have moved the average tariff by K44.07 from MK73.23/kWh to MK117.30/kWh.

As mandated by the Energy Regulation Act, 2004, the MERA Board undertook a review and analysis of the ESCOM application and determined the appropriate increase in the base tariff.

The MERA Board of Directors resolved that the base tariff be increased by 31.8% over the four-year period from 2018 to 2022.

This 31% increase, compared to ESCOM’s requested 60% increase, translates into K21.92/kWh increase and an average tariff of K95.15/kWh against the average of MK 117.64/kWh requested by ESCOM.

The MERA Board further decided that the approved tariff be implemented with effect from 1st October, 2018.

The full determination of the Base Tariff Application can be accessed below:

 

MERA BOARD RESOLUTION ON THE ESCOM BASE TARIFF APPLICATION

Full Resolution DOWNLOAD HERE
Public Notice Notice DOWNLOAD HERE
ESCOM 3rd Base Tariff Application Abridged version DOWNLOAD HERE
ESCOM 3rd Base Tariff Application Main Submission DOWNLOAD HERE