Tonga's electricity tariffs to decrease in February [1]
Monday, February 2, 2009 - 22:07. Updated on Thursday, July 30, 2015 - 15:04.
Tonga's high electricity tariffs will be reduced this month, returning to the mid-2007 level as the falling cost of diesel fuel is passed on to consumers.
Tonga Power Ltd. expects a further decrease in the electricity tariffs in April, stated the Acting Chief Executive David Wright, in announcing the new rates today.
"Electricity tariffs will decrease by 29.91 seniti per kilowatt hour (29%) to 72.76 seniti per kWh on Tongatapu, [and] will apply to electricity supplied after the date of the next meter readings in February," he said.
Increase in non-fuel component
However, a non-fuel component in the tariff has actually increased. The fuel component went down by 41.97 seniti and the non-fuel component went up by 12.06 seniti, making a net decrease of 29.91 seniti.
David explained that the electricity tariff is made up of two components - a fuel component and a non-fuel component
"Normally, it is only the fuel component that is reviewed. This time the Electricity Commission has reviewed both the fuel component and the non-fuel component of the tariff to determine the new electricity tariff," he stated.
The fuel component covers the diesel costs of generating electricity and was last reviewed in August 2008.
The non-fuel component, which had not been reviewed since 2003, he said covers, "the costs of running the business as well as a profit that is specified in the Concession Contract.
"Tonga Power must fund all improvements to the generation and distribution network."
The non-fuel component has been increased by 12.06 seniti from 26.83 seniti to 38.69 seniti per kWh.
The disconnection/reconnection fee will also increase from $23 to $30 on 16 February.
Seven year plan
David said that the increase in the non-fuel component was determined by the Electricity Commission, which had undertaken a review of Tonga Power's costs and plans for the next seven years
It would allow Tonga Power to make new investment in the electricity business, he said "that will meet growth in demand, undertake safety works as well as improve the network reliability and service."
"The demand is close to generation capacity on all four islands. Tonga Power will invest in new generators starting with two new generators in Vava'u in 2009. New generation capacity will be installed in Ha'apai, 'Eua and Tongatapu over the next two years.
The tariffs announced today were:
Tongatapu, present tariff 102.67, new tariff 72.76;
Vava'u, present tariff 104.67, new tariff 74.76;
Ha'apai, present tariff 97.67, new tariff 67.76;
'Eua, present tariff 97.67, new tariff 67.76.