09 Aug 2016

Parliament has passed the Botswana Energy Regulatory Authority Bill, which seeks to provide for establishment of energy regulatory authority whose mandate would be regulation of the energy sector and for matters incidental thereto.

The objective of the bill is to establish an authority responsible for providing an efficient regulatory framework for the energy sector with the primary mandate of providing the economic regulation of the sector with a view of protecting the interests of consumers and providing confidence to investors.

Minister of Minerals, Energy and Water Resources, Mr Kitso Mokaila, said this emanated from a motion that was passed in Parliament last week supporting efforts that had been ongoing for the past four years for the establishment of a power regulator.

MP for Gaborone Bonnington South, Mr Ndaba Gaolathe had in July tabled a motion which requested government to establish an independent autonomous water and power regulator, which was adopted on Friday.

Mr Gaolathe had moved that the establishment of a regulator would create an environment in which the water and power sector may benefit from significantly greater investment as well as efficiency and effectiveness gains, all of which are necessary to provide affordable water and power to citizens and for growth of industry.

Mr Gaolathe further said "there was no doubt that Botswana has reached a stage whereby the country should get right the power and water sector because there was no way the country would develop various sectors that government has identified as necessary to develop the economy without the two commodities."

Mr Gaolathe argued that establishment of a regulator of water and power would create an environment that is transparent and enabling participants to prepare to know what they were getting into.

He said Botswana has an opportunity to become a continental leader in power sector and that power could eventually become a major export earning beyond diamonds.

Minister Mokaila therefore requested Parliament to allow him to use the same facts from where the motion came from to allow him to present the Bill to Parliament of which the house agreed to.

Responding to the debate, the minister said Botswana with her small population that is dispersed around the country makes it difficult for regulators to be effective as in high density countries where the bill can be split out.

He said the cost of infrastructure to take the services to people comes at a high price adding that "generally power producers want to look at a cost reflective tariff which meant most Batswana would be left out.

However he said there were sensitive of such issues to ensure that Batswana were not affected."

Mr Mokaila said the issue of people generating power and putting it back on the grid for sale to Batswana was a noble one.

He noted that part of the reasons why Botswana’s infrastructure was in the state it is now was because the tariffs charged currently are not cost reflective therefore  Botswana Power Corporation and Water Utilities Corporation cannot reinvest as they should in the infrastructure.

He said if one was to come up with Independent Power Producers (IPP) or individuals who want to sell to BPC or WUC there would be disparity because government already subsidises water and power which would ease up the issue of incentives. ENDS