We have no power to cut or raise service charges, utility firms say

Monday April 6 2020



Kampala- Utility companies have said they cannot implement some of the demands being put forward by the public because they have legal implications.

At the weekend, Mr Stephen llungole, the Umeme media relations manager, told Daily Monitor some charges have legal implications that are determined by the regulator – Electricity Regulatory Authority (ERA).

Therefore, he said: “We have no powers to increase or cut service charges.”
Umeme bills include a service charge for both post and prepaid customers, who currently stand at about 1.5 million, according to the company’s financial results for the year ended December 31, 2019.

The utility company has about 1.47 million customers connected on Yaka, a prepaid service, out of the 1.5 million on its network.
A number of people and civil society, have since the lockdown early last week, demanded that utility companies find a way of easing bills payment for customers through elimination of some charges at a time when many Ugandans are not working.

“Umeme, NWSC and other utility [companies] should consider temporary removal of service charges to reduce the burden of paying bills ... during this [period] of Covid-19” a tweet posted by Civil Society Budget Advocacy Group, said last week, echoing a number of voices that have advocated for the same through traditional and social media.

However, at the weekend ERA, which regulates the electricity sub-sector, said it was difficult to remove or decrease service charges because they involve third party agreements.


While responding to Daily Monitor’s inquiries, Mr Julius Wandera, the ERA communications manager, said that whereas companies within the electricity sub-sector had implemented the directive of not disconnecting customers with pending bills payment, the service charges will, for now, remain as is, noting; “when they have to be looked into, there is a mechanism to do it”.

“If Cabinet wants to advise ERA in a particular way, the minister [of Energy] will write to us in respect to that guidance,” he said, noting that in the event that it comes to the point of dropping service charges, government would have to provision for such expenses because they involve third party agreements.

Mr Wandera also noted the electricity sub-sector is dominated by private players, who in addition to other obligations, have borrowed money to invest in Uganda’s energy sector with the hope of recouping the same through a number of charges key among them service charges.

In his address last week, President Museveni directed that utility companies should not disconnect customers with pending bills.
However, a number of Ugandans have been wondering how government would help those who pay prepaid services, many of whom are struggling with bills yet they are not earning.

Utility service providers last week said they had implemented the President’s directive, noting no one would be disconnected during the quarantine period.

However, apart from suspending disconnections, there had been no other measures to ease bills payment.
Mr Samuel Apedel, the NWSC communications manager last week, told Daily Monitor that service chargers were third party fees, noting it was outside their mandate.

However, he said, apart from suspending disconnections, they had waived disconnection fees for those who had already been disconnected before the President’s directive.
“The public can now pay only for the current bills without any charges for reconnection,” he said, noting NWSC had put together 12 rapid response units for all water related issues.