Government is still carrying out electricity tariffs review with the aim of reducing them in response to consumers’ needs, and lowering the cost of production, the Minister of Infrastructure has said. Ernest Nsabimana told The New Times “we are about to finalise the review, and we are looking at all the categories concerned with electricity,” he said, citing factories, health facilities, schools and residents READ ALSO: Cost of borrowing, utilities, key challenges for investors – report However, he did not mention the exact date when the new prices are due, indicating that they will have to be approved by different concerned entities. He was talking about the progress on electricity tariff review after Prime Minister Edouard Ngirente told Parliament on August 1, 2022, that revised prices would be announced within two months from then – implying by the end of October last year. That time, Ngirente told legislators that high-cost electricity was not only a concern for schools, but health facility,es and residents also were complaining about high energy bills. To address the issue, the Premier said that they were reviewing the entire electricity tariff in the county, and that they would have announced new prices within two months. On the fact that there has been a delay in issuing the revised electricity prices, Nsabimana said that the review exercise might have taken long because of the size of the sector, among other parameters. “We will do our best so that the review is completed soon,” Nsabimana said, adding that it is a joint exercise factoring in a cost analysis that was being made by the Ministry of Finance and Economic Planning, pointing out that the review is a joint exercise. According to the current electricity tariffs set by the Rwanda Utilities Regulator Authority (RURA) on January 21, 2020, health facilities have to pay Rwf186 per very kilowatt-hour (KWh) they consume. A KWh is about the same amount of energy that can power a typical microwave for a one- hour period. In the industrial customer category, energy charge is Rwf134 per kilowatt-hour (KWh) for small businesses, Rwf103 per KWh for medium businesses, and Rwf94 per KWh for large businesses. Given that a small business in the industrial category consumes at least an estimated 22,000 KWh annually to run its operations, the cost would amount to about Rwf3 million per year – with a KWh priced at Rwf134. On factors that were being considered during the review, Nsabimana said they include looking at the current price and the business in general, people’s purchasing power, and the country’s energy generation trends. Teddy Ndayambaje, General Manager at Master Steel Ltd, a company that manufactures construction materials like roofing sheets, mild steel plates, and bars, told The New Times that “so far we appreciate the Government of Rwanda for all efforts made to produce the energy required for economic activities.” “Though rates are higher compared to the region, at least we have a stable and constant power supply, rates vary depending on production schedules for instance off-peak, and shoulder hours can save much money compared to peak hours,” he said. In reference to the proposed review, he pointed out it is obvious that the cost of production will improve positively along with the reduction of power supply rates, and therefore benefit “the end users of our products.” “Power rates review should be a win-win scenario of production cost to generate the power as well as the purchasing power of the buyers (industries, household etc....),” he observed. Nsanzimana suggested that electricity prices were likely to go down as a result of increase in energy generation in the country, at relatively lower production costs. He cited projects that are “soon coming onboard” like the $400 million Shema gas methane power project [with a capacity to generate 56 MW from Kivu methane gas], and the $340 million regional Rusumo Hydropower Plant expected to generate 80 MW to be equally shared between Rwanda, Tanzania and Burundi.
