Water and electricity tariffs will fall next year, the Managing Director of Electrogaz, the national and water utility, John Mirenge, has said.
“We are making sure that the prices fall by next year despite a number of challenges we are still facing,” he said.
He could however not disclose the planned price cut. Currently, electricity tariffs stand at Frw112/KWh, water is at Frw240/5m3.
Mirenge was on Tuesday addressing a press conference at Prime Holdings in Kimihurura.
“We are going to upgrade our transmission and distribution networks throughout the country but this will be supported by a better financial control,” he said.
The reduction in tariffs, Mirenge said, will come as a result of improved reliability and increment of power and water.
In 2005, power tariffs shot up to Frw112 from Frw87 following persistent droughts which caused sharp fall in water levels thus affecting generation of hydroelectric power. Water tariffs were increased from 200/5m3 early this year to 240/5m3 ostensibly to cover operating expenses.
Rwanda was hit by a power crisis between 2005 and 2006 but there has since been an increase of up to 14 percent in hydropower production and 30 percent increase in power importation.
“One of the strategies was to reserve our water sources for hydropower while importing thermo power,” Mirenge said. He explained that the strategy paid off as it helped achieve marginal reduction of total losses from close to 23 to 21 percent in just two quarters.
Mirenge highlighted Electrogaz’s progress over the last six months for the year 2007.
He said electricity will be extended to five districts by next year.
Despite this good news, a huge proportion of the population still lacks water and power. The overall access is about 5 percent.
Statistics indicate that more people received power than water in 2006, and the trend is expected to continue as more investments in power compared to water.
From 2004 to 2007, water clients only increased from close 37,700 to 47,000 yet the number of electricity users increased from about 64,000 to 8, 3000 over the same period. This trend is attributed to poor infrastructure across the country.
The Chairman of the Electrogaz Board , Prof. Chrysologue Karangwa said: “We know that there are even more people in the City of Kigali with less access to power and water what we have to do is to squarely assess the problem and then come up with effective actions.”
He said the unfavourable infrastructure system has largely been caused by unplanned settlement especially in Kigali.
Mirenge said the government has an aggressive ambition of improving access from five to ten percent by 2011.
He said Electrogaz had so far invested more than Frw10 billion in the energy sector and made Frw35 billion in profits. Between January and June 2007 alone, Electrogaz registered profits of Frw930 million.