The annual tariff review is one of the most anticipated activities in the electricity supply industry as it gives an indication of the price of electricity consumers will pay.
JULIUS WANDERA,the director of Corporate and Consumer Affairs at the Electricity Regulatory Authority, addresses key questions about the upcoming Annual Tariff Review Public Hearing, which will take place in Lira tomorrow, December 12
The Electricity Regulatory Authority (ERA) recently ran a notice inviting the public to take part in the Annual Tariff Review Public Hearing; what can you tell us about this?
Yes, ERA has organized a public consultation on the 2025 electricity tariffs and invited the public to participate, in line with Section 18(2) of the Electricity (Application for Permit, Licence, and Tariff Review) Regulations, 2007.
The Annual Tariff Review Hearing allows the public to review applications from key electricity companies, including Uganda Electricity Generation Company Limited (UEGCL), Uganda Electricity Transmission Company Limited (UETCL), and Umeme Limited.
These companies propose cost adjustments to cover projected operational, maintenance and investment costs. To ensure transparency, ERA tasks them to present and justify their proposals during the hearing, providing the public an opportunity to engage and interrogate the tariff-setting process.
A similar gathering was conducted recently in October; how different is it from this Annual Tariff Review Hearing?
The public hearing held in October sought to pick the views of the public on the applications by Uganda Electricity Distribution Company Limited (UEDCL) to take over the Umeme concession for the sale and distribution of electricity in Uganda upon its expiry on March 31, 2025.
The upcoming annual tariff review public hearing, on the other hand, is a consultation on the applications by UEGCL, UETCL and Umeme Limited for review of end-user electricity tariffs to be charged next year 2025. That said, Umeme’s application covers only three months of their operations in 2025.
Does this mean that ERA sets different tariffs each year? Secondly, Umeme has less than three months of operation; should we expect further changes when UEDCL picks up the mantle?
End-user tariffs are reviewed and determined annually, in line with Regulation 14 of the Electricity (Application for Permit, Licence and Tariff Review) Regulations, 2007, and the tariff methodologies included in the licences of the companies.
These are known as the Base End-User Tariffs and are effective from January to March each year. The Base End-User Tariffs are thereafter adjusted every calendar quarter starting in April in line with the Quarterly Tariff Adjustment Methodology (2014), to reflect changes in the macroeconomic factors (including inflation, exchange rate and fuel prices) and energy mix.
Therefore, whether or not there is a change of supplier in 2025, electricity consumers should expect further adjustments in electricity prices after March.
According to the notice, the public hearing will be held in Lira city, away from the capital city. Why? Will this be representative of all the views of Ugandans?
For the first time in its history, ERA is holding this critical activity outside the capital city, reflecting its commitment to enhancing stakeholder engagement, raising awareness of the electricity sector, and involving all Ugandans in essential decision-making processes.
Decentralizing these engagements allows us to reach more people across the country. To ensure nationwide participation, the hearing will be live-streamed on ERA’s digital platforms, including the website, X, and YouTube. Stakeholders can also join in via Zoom to share their views.
I urge all Ugandans to participate in this important process of setting cost-reflective tariffs that balance stakeholder interests, sustain the electricity supply industry, and support Uganda’s development goals.
Finally, when should we expect to know the 2025 tariffs?
Upon completion of the process, the approved tariff schedule will be announced in the newspapers and published on the ERA website before the end of the year. The new tariffs will take effect in January 2025.
