Martin Endjala
The establishment plans of a Southern Regional Electricity Distributor (SoRED) which emerged in 2014, have received the blessings of the Ministry of Urban and Rural Development.
The development follows a recent circular from the ministry’s Executive Director, Daniel Ngidinua which stated that shareholding and asset transfer agreements have been approved.
The circular stated that the granted approval by the Ministry as advised by the Attorney General’s Office is set with conditions.
The circular stated that the proposals, comments and changes made by the AG’s office must be inserted before the agreements are signed and copies sent copies of the agreement must be submitted to the ministry for recording.
Responding to this approval the Electricity Control Board Spokesperson, Ferdinand Molale said that consultation meetings between the regulator and the key stakeholders have been ongoing. He added that one such meeting which discussed Shareholder Agreements and the Asset Transfer Agreements took place two weeks ago.
Molale said that the Shareholder Agreements and the Asset Transfer Agreements received inputs from the AG’s office and the ministers of MURD and Ministry of Mines and Energy but he could, however, not go into details of some of these inputs due to ongoing consultations.
He did hint that the next deliverable will be the signing of the agreements and appointment of directors while expressing hope that the commencement of the proposed RED will be expedited and completed before the end of the year.
Meanwhile, the Hardap Regional Council Chairperson, Gerhson Dausab in a recent interview about the establishment of a SoRED, said that the National Electricity Fund has agreed to spend an estimated amount of N$30 million over seven years to establish and stabiles the new RED.
Dausab said that SORED can expect N$30 million in profit annually without any increases in levies. He also indicated that he met with the MME Minister, Tom Alweendo last week in Windhoek where he handed concept documentation to him.
An advisory document has been compiled by a technical team and it has since been sent to the AG’s office for approval after a few changes were made.
Despite the good news, there are, however, concerns from community members, citing the current debt owed to NamPower by certain other REDs and the sustainability of such a venture.
Gerrit Witbooi the former Keetmanshoop Regional Councillor, says he does not support the establishment of the RED.
He emphasized that this will give leeway to the middleman, which is already a current factor being exercised by the government by giving powers to NamPower and not to MURD to supply electricity instead.
He stated that the establishment of a SORED in the South will further exacerbate the region’s utility debt.
“We as the Aroab village council and community, have a resolution, already passed by the council, to reject SORED, because Aroab has no issues with NamPower, nor does it owe the utility. We are happy with our prepaid services and we make enough money to sustain ourselves. Why should we now shift to another utility?” argued Witbooi.
He stated that the Aroab Village Council will not be using SORED should it be enforced in the region because of the resolution.
Witbooi cautioned the government and all others involved to exhaust all alternatives to avoid similar trends experienced by other REDs.
Witbooi is still of the opinion that the establishment of SORED is a recipe for failure, torture, and more infliction on the already struggling residents in the south because tariffs are increasing continuously.
