Dear Editor

The recent news that Walvis Bay Plastic Products is now moving to Botswana and one of the reason therefore given was a fact, that it has to pay up to N$1.25 mil as so-called “Network Contribution”. This has sparked my reaction.
The establishment of the  RED system immediately caused a price increase of 10% in electricity tariffs, whereupon the Local Authorities increased their rates and taxes twice by about 10% due to a lack of income they normally had by the sales of electricity.

In July we experienced another increase in electricity tariffs in Swakopmund of 18% on electricity after Nampower raised their unit by about 15%, whereas the Omaruru farmers experienced an increase of about 36%. Although the Electricity Control Board does not allow any variation more than 15%, this was approved by them. The tariffs of the prepaid metering system as installed at our poorer community were also increased with an unheard amount.
This, however, proves not to be enough to compensate for the funds needed for the RED system. They are now implementing the so-called “Network Contribution” wherever they can with astronomical amounts, as can be seen with the Walvis Bay affair.
Developers are being charged with huge amounts, without proof of how such amounts are calculated, you just have to pay up. It happened, that “Network Contribution” is being charged if a client wishes to increase his connection from say 40 Amps to 60 Amps, but no refund is given if one reverses the demand to a lesser one.
It is difficult for us to understand the difference between the need of “Basic Charges” and “Network Contribution”, but the latter certainly proves to be an open cheque book for the electricity distributor. Previously, any surpluses made by local authorities were placed into funds used for capital developments, but in this case, this seems to be not enough to cover operating expenses.
The question here is: are those contributions really being placed into special funds to improve our network, or are they just being used to cover operating losses? Does the same apply to the “Basic Charges”?