(3 minutes read)
· The Ethiopian Electric Utility (EEU) is implementing electric tariff adjustment that supports its financial stability and access to finance for projects to improve its services
· The tariff change has helped financial stability of the power utilities and the enders are coming forward to fund their diversification and expansion programs since they are sure of getting back the money lent
· Because of the increased cash flows, EEU has now access to finance rehabilitation work in six towns, such as Harar, Shashemene, Adigrat, Wolayta, Gonder and Debre Marqos
The Ethiopian Electric Utility (EEU) is implementing electric tariff adjustment that supports its financial stability and access to finance for projects to improve its services. The tariff adjustment, which was delayed for long is now being implemented in phases. It will be completed by December 2021. Shiferaw Telila, CEO of EEU, said that increase in the revenue to the power companies because of the rise in rates helped companies in shoring up the confidence of lenders, who provide finance for projects including for rehabilitation work. Previously banks were hesitant to lend to power utilities because of their poor financial situations. The tariff change has helped financial stability of the power utilities and the enders are coming forward to fund their diversification and expansion programs since they are sure of getting back the money lent.
Previously the tariff was very small and could not enable the undertaking of expansion and network rehabilitation works excluding covering operation cost. This had adversely affected most of the city networks including Addis Ababa. They could not invest in enhancing the power generation because of the outdated networks and transmission lines. Because of the increased cash flows, EEU has now access to finance rehabilitation work in six towns, such as Harar, Shashemene, Adigrat, Wolayta, Gonder and Debre Marqos.
