By Steven Godfrey Mkweteza
The Electricity Supply Corporation of Malawi ( ESCOM), has said it is has been struggling to execute some of its operations due to the MK35 billion debt which the Blantyre water board( BWB) has owed the corporation in unpaid arrears.
Chief operations officer for the power utility body, Maxwell Mulimakwenda, the unpaid debts has made the corporation to incur MK87 billion in additional costs, which has affected it’s revenue.
He said as a result of the revenue deficit in the year 2018-2022 base tarrif period, Escom underperformed in some of the key performance indicators.
“These include among others, new connections, adherence to customer service and implementation of some planned investments or projects. This is because we priotised paying generators and independents power producers(Ipps) while our operations suffered, ” he said.
According to Mulimakwenda, the sector has reported a total revenue deficit of MK99.18 billion in the period of July 2018 to December 2022.
Speaking recently during the public hearing on the 2023-2027 electricity tarrif base adjustment in Blantyre, Mulimakwenda said his corporation has so far been engaging officials from BWB but to no avail.
” This delays to recover the debt has indeed negatively affected our operations and subsequently made us failed to meet connection targets in the 2018-2022 tarrif period. That is alot of money which is just idle. It would have been put to some use, ” he said, adding that the poor performance was also mainly due to financing arrangements.
According to Mulimakwenda, the fresh electricity tarrif adjustment application would see 30 percent of the tarrif go into total revenue collection.
Recently, the parliamentary committes have pledged to help the electricity Supply corporation of malawi( ESCOM) to recover about MK40 bilion that government ministries, departments and agencies(MDA’s) owe it.
But Mulimakwenda said of this amount, MK35 bilion is owed by BWB.
The fresh electricity tarrif hike proposal comes against a background of water boards implementing an average 59 percent tarrif high from June 1 this year.
Spokesperson for the Blantyre water board(BWB), Evelyn Khonje could not pick her phone despite several attempts to hear on the side of the water utility body.
In April this year, Escom applied for a 69.7 percent electricity tarrif adjustments for the next four years (2023-2027)after the expiry of the 2018-2022 tarrif period.
This is a travesty. How can you continue to provide a service without being paid. Surely, they do have financial policies on debt repayment. Is this an assumption of working for the same company/government? The entire Top Executive board should be fired.