The Electricity Control Board (ECB) has announced a major adjustment to NamPower’s proposed revenue requirement, slashing the national utility’s request by more than N$700 million following an extensive review process.
NamPower had initially applied for a revenue requirement of N$8.8 billion for the 2025/2026 financial year, but the ECB approved only N$8.1 billion after conducting a detailed analysis of the utility’s tariff application and its implications.
“This amount represents the total cost required to supply electricity and keep the lights on. That figure has now been revised by the ECB, from N$8.8 billion down to N$8.1 billion, following their due process. So essentially, we’ve reduced the requested revenue requirement by nearly N$700 million,” said ECB CEO Robert Kahimise.
The ECB Board reached its decision after deliberations on 16 April and 12 May 2025, and the review considered a number of critical factors, including the utility’s financial sustainability, electricity affordability, and the potential economic impact of any tariff changes.
The regulator ultimately approved a tariff increase of 3.8%, significantly lower than the 17.44% initially requested by NamPower.
The ECB also considered the utility’s over-recovery of N$963 million in the 2023/2024 financial year, primarily due to unexpectedly high generation from the Ruacana Hydropower Plant.
Kahimise said to support the lower adjustment, the Namibian government will provide N$283 million in financial support to NamPower, equivalent to the 3.8% increase.
“This brings the average tariff up from N$1.9856kWh to N$2.0611kWh for the 2025/2026 period. Regarding the impact of the approved bulk tariff on the economy, with the tariff increasing at 3.8%, below the current inflation rate of 4.2% (March 2025),” he said.
He added that the decision is expected to have minimal impact on inflation and consumer prices, though a slight negative effect on GDP growth is anticipated due to the role of electricity costs in inflation calculations.
“While we are cognisant of the impact of any tariff increase on the end consumers, a zero tariff increase has unintended consequences: deterioration of infrastructure without the necessary and continual refurbishment and renewal, which will lead to an unstable grid, damage to equipment, and blackouts,” he said.
He said these, in turn, will lead to financial and economic losses and poor economic performance, thus an unfavourable investment environment for citizens and other interested parties.
This comes as the Namibia Power Corporation (NamPower) is grappling with unpaid customer debts, which have pushed its total outstanding overdue debt to N$960 million.
The utility recorded N$157 million in expected credit losses for the 2024 financial year, citing widespread non-payment as a major factor straining its financial stability and hindering critical infrastructure investments.
NamPower sought a 17.44% tariff increase for the 2025/26 financial year, driven by its ongoing inability to recover costs through current tariffs due to regulatory constraints.
The company had requested the increase to meet its N$8.8 billion revenue requirement for the period, covering key expenses including energy costs of N$5.6 billion, fixed costs of N$1.4 billion, and N$2.2 billion for return and depreciation.
