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Private sector calls for unbundling of BPC

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Private sector calls for unbundling of BPC

The Botswana Energy Regulatory Authority (BERA) has been urged to consider liberalising the energy sector by unbundling Botswana Power Corporation (BPC) and delegating some of its core functions to the private sector.

The call was made at a public hearing that was hosted by BERA this week, at which BPC was motivating for a five per cent upward tariff adjustment for 2021/22 and another four per cent increment for 2022/23.

The BPC request comes in the wake of a 22 percent upward adjustment in 2020.

When making a presentation at the hearing, Botswana Chamber of Mines Chief Executive Officer (CEO) Charles Siwawa said it was time for BPC to start remodelling itself after 50 years in existence.

“We need to unbundle other sections of the Corporation like distribution, transmission and supply to ensure cost-cutting and efficiency,” said Siwawa.

He added that the recent 22 per cent tariff increase impacted negatively on business as it greatly increased their input costs.

He called for BPC to opt for small single digit increments instead of substantial once-off tariff increases.

Siwawa further challenged BPC to take advantage of existing opportunities in the South African Power Pool (SAPP) by generating power for export.

For his part, Gabaake Gabaake of Tlou Energy called for further liberalisation of the energy sector to allow Independent Power Producers (IPPS) to not only generate power but also sell it to the export market.

“Unbundling BPC will encourage competition, which breeds better prices and services. It will also give us an opportunity to drive our national aspirations of economic transformation and becoming active players in the fourth industrial revolution,” said Gabaake.

When responding to the private sector submissions, Acting CEO Edward Rugoyi said BPC was fully in support of assisting more IPP’s to generate power and pump it into the national grid. However, he said, the corporation was strongly against allowing IPP’s to sell to the market.

“We believe IPP’s should sell directly to BPC,” said Rugoyi.

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