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Proposed electricity tariff hike will extract Rs. 34bn from poorest consumers: Harsha

05 Apr 2013 - {{hitsCtrl.values.hits}}

Proposed revisions to electricity tariffs are an attempt by the Ceylon Electricity Board (CEB) to extract Rs. 34.2 billion primarily from Sri Lanka’s poorest consumers, according to Opposition Member of Parliament, Harsha De Silva.

The CEB itself estimates revenue to increase to Rs. 220 billion through the proposed tariff structure as opposed to Rs. 173.8 billion at its current rates.

In submissions made to the Public Utilities Commission of Sri Lanka (PUCSL) yesterday, De Silva warned that the proposed tariff structure will adversely affect up to 48 percent of the CEB and Lanka Electricity Company (LECO) consumer base.

He cited studies carried out by the University of Colombo, also utilized by the CEB in calculating tariff rates, which found that a household of 4 in Sri Lanka requires a minimum of 48 kilowatts per hour (kWh) per month in order to maintain a “decent quality of life”, an amount which 42 percent of CEB’s and LECO’s 5 million customers are unable to afford with a further 1.3 million customers utilizing under 60 kWh.

De Silva stated that the consumers who use under 30 units a month would be facing tariff increases of up to 53 percent while consumers using less than 60 units a month would be burdened with a 47 percent increase.

He went on to call for the creation of an alternate tariff structure which would move the burden of increased rates away from low-income consumers to higher income groups, with the caveat that any revisions must not be used to recover the cost of alleged “corrup- tion, waste, misuse” or mismanagement from the consumer.

Alternatively, De Silva called for either the creation of an additional user group of consumers utilizing less than 45 kWh per month which could subsequently be shielded from the brunt of price increases or a direct, transparent, subsidy programme issued by the Treasury and targeted solely on Sri Lanka’s electricity poor.

With regard to the latter proposal, De Silva again reiterated that the subsidy programme must not be misused. He cautioned that the CEB’s proposed Rs. 1.7 billion subsidy lacked such transparency and could well be utilized to unjustly subsidise high income consumers.

The tariff structure proposed by the CEB calls for Rs. 5 per kWh and Rs. 6 per kWh for consumers under 30 units a month and between 31-60 units per month respectively.

The fuel adjustment charge would stand at 25 percent and 35 percent respectively. Users between 61-90 units would be charged at Rs. 8.50 per kWh, amounting to a 40 percent fuel adjustment charge.

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Proposed electricity tariff hike will extract Rs. 34bn from poorest consumers: Harsha

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