05:41 am - Wednesday 21 November 2018

Malawi Energy Regulatory Authority starts to benefit from MCC

By Amalawi - Fri Oct 03, 7:55 pm

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Malawi: The Malawi Energy Regulatory Authority (Mera) has started benefiting from capacity building programmes under the Mil lennium Challenge Corporation (MCC) compact programme.

Among other things, some members of staff of Mera have undergone a training on costing and tariffs by power utilities under the MCC funded Power Sector Revitalisation Programme.

The Mera technocrats underwent a capacity building training on cost of service analyses principles and tariff setting methodology which was conducted by the Tariff and Regulatory Service Advisory firm, Aurecon.

Malawi Energy Regulatory

Malawi Energy Regulatory

The training was conducted under the Power Sector Reform Project of the MCC Compact programme which complements the Infrastructure Development Project by providing support to government’s policy reform agenda and building capacity at the Electricity Supply Corporation of Malawi (Escom), Mera and the Ministry of Energy.

Millennium Challenge Account (MCA-Malawi) engaged the services of Aurecon to support government in building capacity of Mera to improve its regulatory oversight activities and operations.

Mera’s Director of Economic Regulation, Eunice Potani, said the training by Aurecon brought to the fore pertinent issues that will assist the authority to close the capacity gaps for future tariff setting processes by focusing on best practice regulatory principles and the importance of cost of supply in tariff setting.

She said the training has also helped consolidate and come up with a more comprehensive tariff setting methodology which will guide both regulator and utility in structuring and analysing any tariff applications.

Potani said the financial model developed for Escom will act as a tool that will assist the power utility company and Mera in undertaking a diagnostic review of Escom’s performance.

The training specifically covered the cost build up on the determining the cost of service in the electricity supply chain of generation, transmission and distribution on best practice guidelines in tariff setting methodology, including aspects of transfer pricing as well as issues to do with the balance between the commercial and social considerations in electricity price setting process and the required supporting policy and legal frames.

The training also covered issues to do with promotion of private sector participation and what needs to be done to create proper environment for private sector participation.

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