Umeme to recover Shs104 billion from domestic customers

Sunday April 8 2018

 Power Sector Reform and Regulation in Africa report, Umeme

According to Power Sector Reform and Regulation in Africa report, 15 units are enough to power three energy saver bulbs and a transistor radio for one month.  

By Nelson Wesonga

Kampala. Electricity distributor Umeme’s domestic customers will part with Shs103.7 billion that Umeme did not collect because it underestimated the lifeline units they had consumed.

The money will be recovered via the end-user tariff, the consumers will pay starting from April 1 to June 30.

Close to one million of Umeme’s 1, 125, 291 customers will be impacted.

“Owing to underestimation of the units consumed below the lifeline, the company under-recovered Shs57.7 billion and Shs46.0 billion relating to 2017 and 2016 respectively from the end-user tariffs as determined by ERA…” says Umeme’s 2017 financial results.

“[The Electricity Regulatory Authority] has agreed that these payments are properly due to Umeme through collection from [Quarter] 2 2018 tariffs.”

Households, kiosks and small shop owners, who fall under the domestic consumers’ category, pay Shs150 for each of the first 15 units consumed.

Each unit after the fifteenth costs Shs718.5.

According to Power Sector Reform and Regulation in Africa report, 15 units are enough to power three energy saver bulbs and a transistor radio for one month.

Umeme has in the past said some of its customers often complain either about the service fee and the lifeline tariff.

These two are charged once a month.

In cases where a consumer purchases units more than once in a month, the units got using the same amount of money varies, which baffles many.

To address this, Umeme had suggested in its Annual Tariff Application for 2018 that, among other considerations, ERA should remove the lifeline tariff and the service fee.

In their place, Umeme had suggested that ERA introduces a single average rate for all units bought by domestic customers.

ERA did not authorise the removal of this because, according to some accounts, Umeme had not anchored its proposal on a study.

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