New Year Ushers Electric Tariff Raise

Sep 8 , 2024

A new electric tariff structure is implemented nationwide aimed at improving the financial health of the Ethiopian Electric Utility (EEU). This move is part of broader energy reforms to enhance infrastructure and service quality. EEU CEO Shiwaferaw Telila noted the urgent need for updated tariffs to address the utility's mounting financial burdens. Outdated rates, which have not been adjusted for over a decade, have made it difficult for the EEU to meet the growing electricity demand of the population. The revised tariff structure introduces a rate of six birr for a killo watt per hour domestic households, with tiered pricing for commercial, industrial, and public lighting users. The tariffs are scheduled to be reviewed every four years, with quarterly increments, provisions for mid-term adjustments in response to significant economic or social changes. To mitigate the impact on households, the EEU plans to subsidise up to 75pc of usage for those consuming less than 200kWh. However, higher consumption will incur incremental costs. In the past fiscal year, the EEU generated 42.5 billion Br in revenue from electricity consumption. The utility is now targeting a 36pc increase, aiming for 58 billion Br in the coming year. Despite these efforts, the year-end report revealed that 44pc of the Ethiopian population still lacks access to electricity. The EEU added just over 427,000 new customers, bringing the total to 56 million households.